Most borrowers are paying less in their home loan repayments than they would if they rented in the same suburb.
When buying a house under a three-year fixed rate scenario, over half of Australian suburbs were cheaper to pay down a mortgage than pay rent on a house. This growing trend of home loan borrowers paying less in their mortgage repayments than rent has been attributed to record-low mortgage rates, combined with a slightly weaker property market.
Why pay your landlord?
when you could potentially pay the same amount – or less monthly –
on a place you can call your own?
So what do you need to do or have to make the jump and buy your own place?
– Have a sufficient Deposit
In all the literature you will find that a minimum 5% deposit is required to purchase your own place. This is correct however you also need to find the funds to cover the LMI.. all up this means that you need about 8% deposit.
And then depending on your circumstances you may need to find funds to cover the Stamp Duty – unless you are a FHOB and benefit from a stamp Duty concession and other benefits like the FHOG and other incentives
– Have sufficient Income & Borrowing Capacity
An analysis of your financial situation, income type & amount, asset & debt position is how we determine what you are able to borrow as a maximum loan amount = Borrowing Capacity (BC)
The calculation of your BC has become increasingly complex over the last 10 years and can differ a fair bit between different banks and lenders. It is a smart idea to get your BC assessed before launching into a property searches to ensure you are looking at properties in your price bracket
– Have a ‘Clean’ credit report
Your credit report reveals to the banks & lenders a fair bit of information about your credit activity & behaviour.
Reviewing your credit report is important to ensure there is no untowards listed than my jeopardise an application approval.
So what does your credit report show these days?
• Credit enquiries – every credit enquiry you make gets recorded – whether this was for a home loan, a car loan, credit card or even Zip pay & Afterpay – if your enquiries amount to more than 5-6 in the last 12 months you are starting to jeopardise your chances of approval with some lenders and LMI providers. To avoid issue here make sure you only apply for essential credit and stay away from consumer lending like afterpays, etc
• Credit conduct – every debt facility you have currently opened will be listed on your report with limit of the account, repayment amount & a monthly record of whether you have made your payment on time for that facility. If you are a late or tardy payer, it will be reflected on your report and will jeopardise your chances of approval with some lenders and LMI providers. To avoid issues here make sure you pay your debts and bills on time.. every time.
• Bankruptcies, defaults & judgements – you report will also show insolvency events and if you had any of these then it is best to contact us for how you can get back on the straight & narrow lending wise
– Find a suitable property
Once we have workshopped all the above then you will be able to go shopping for a suitable property with the right price point, attributes – new or existing, and location.
So if this sounds like you? If you want to make the move away from renting?
If you want to pay less than rent to own your own place?
It’s time for you to get you situation assessed.. just Click on the “APPLY” button below
