Buying your first home is always special. However, buying a home is not an easy task, especially for a first-time buyer. Yet, with a bit of research and planning, you can make the purchase of your first home a memorable and tension-free affair. The key to hassle-free home buying is preparation.
Most of the homebuyers would give attention to basic features like location, price, council rates etc. However, it is likely that they’ll miss certain other important factors.
If you are looking to buy your first home, here is a checklist to help you. This checklist highlights those points that are easily overlooked.
Pre-approval of loan
It is very rare that you buy a home without any loan. It makes sense to get your loan pre-approved before you start house hunting. This helps you to set a realistic budget as well as to show the realtors that you are a serious buyer.
Stamp duty tax
Most property purchases in Australia attract stamp duty taxes. The tax amount varies according to the price of the property, location (state or territory) and the like. As it has to be paid at settlement, don’t forget to include this in your budget. Normally, your home loan lender would factor in the stamp duty. If he didn’t, you can use a stamp duty calculator to get an idea of the cost.
Lender’s Mortgage Insurance
In case your borrowing is more than 80% of the property, you may have to pay the lenders mortgage insurance as well. It is a protection for the lender against borrower defaults.
Contract of sale
Obtain a contract of sale as soon as you decide to buy a particular property. You should get it reviewed by a solicitor or a qualified conveyancer.
It is important that you get a professional to check the house thoroughly before you make the purchase. The professional inspectors can spot some of the hidden problems like structural damage, pest infection, dampness and the like. These may not be visible to an untrained eye. A professional inspection makes sure that your home is safe. It could also save you money in the future.
Get the help of a professional settlement agent or solicitor, as the transfer of the legal title of the property to you could be a complex and tiring process. It is most likely beyond the comprehension of a first home buyer.
Statement of Adjustments
It is also important to get the statement of adjustments from the settlement agent or solicitor. Statement of adjustments is a record of the adjustment of any rates, taxes, rental, and owner’s corporation fees pertaining to the home you are buying. You may have to set aside some funds to cover your share of the adjusted rates as a part of the property settlement.
These are some of the most important yet commonly ignored steps in home buying. If you are a first-time homebuyer, keep this checklist handy and make sure you don’t miss these critical aspects of home buying.