If you’ve found your dream home or you just want to be ready for when the time comes, we’ve created a checklist of what you can do to prepare for
If you’re not familiar with home loan pre-approval, it simply means receiving conditional approval from a lender for the amount you’d like to borrow – which you can get before you’ve even found your ideal property.
Why would you want pre-approval?
It gives you a clear idea of how much you can afford to spend, which can help you narrow down your search and avoid looking at properties that you can’t afford. Plus – when you do find a place you’d like to buy, you can make an offer with more confidence! Keep in mind that pre-approvals are often valid for a set period – normally around three to six months. Get a conveyancer on your side A conveyancer (or a solicitor) will arrange the property ownership transfer process for you. They’ll review the contract of sale when you’re ready to buy, ensure everything is in order and may help arrange pest and building inspections before you exchange contracts. It’s a good idea to find this legal representation early so when you are ready to buy you already have someone lined up who you feel comfortable with.
Know what’s happening in the market
If you’ve been shopping around for a home, you’ve likely gained a fairly good understanding of what’s going on in your local real estate market. And if you haven’t, it’s worth doing your homework before making your first offer. If you know what similar properties have been selling for, and how long they’ve been on the market, you’ll know how much bargaining power you’re likely to have and where to pitch your first offer.
If you don’t have time for research and want to offer a realistic price, consider getting a buyers’ agent involved. They’re experts in price negotiation and will have a good sense of what your chosen property is worth in the current market.
Fine tune your negotiating skills
Negotiating a purchase can be nerve-racking, but try to cover these basics before you start negotiating:
- Do your research so you can make a realistic offer
- Put your offer in writing
- Secure pre-approval for financing (a broker can help you with this)
- Build a relationship with the seller’s agent – don’t negotiate directly with the seller
- Be happy to walk away if the deal doesn’t work out.
To help get your offer over the line, you might also consider offering the seller a ‘sweetener’ such a shorter settlement period. You should always check with your solicitor and mortgage broker about the implications of this and ensure that the necessary property inspections have been completed.
Learn about the different ways to buy – private treaty and auction
If you’re noticing a lot of properties that you’re looking at are going up for auction, there’s a chance the one you might want will also be sold at auction. Even before you’ve found ‘the one’, it’s a good idea to attend a number of auctions as a spectator to get a feel for the process.
When you're buying a home there are often two options - private treaty or auction. But how are they different? In essence, private treaty is when the seller sets the price and you negotiate with them until you reach a price you're both comfortable with. Auctions on the other hand are when interested buyers come together and bid on the property, with the highest bidder the winner.
When you’re preparing for purchase, an Aussie Broker can help you find the right home loan for your pre-approval so it’s ready when you are!
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Take the next step to buying your first home
- Chapter One : Getting started
- Chapter Two : Your dream home
- Chapter Three : Money matters
- Chapter Four : Ways to purchase
- Chapter Five : Understanding interest rates
- Chapter Six : Understanding home loans
- Chapter Seven : Lending sources
- Chapter Eight : Getting your loan
- Chapter Nine : Choosing a home
- Chapter Ten : Steps to settlement