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Although you may have purchased a property before, the lending requirements and costs involved will most likely have changed since your last purchase.

Although you may have purchased a property before, the lending requirements and costs involved will most likely have changed since your last purchase.

So before you move enthusiastically into finding your next dream home, a bit of homework early on will save you stress later one.

What will a lender allow me to borrow?
How much do I need to have saved? 
What benefits are there for first home buyers?
Are home loans with the cheapest interest rates the best option?
Each of these questions is dealt with in greater detail in our FREE eBook:  Next Home Buyer

What will a lender allow me to borrow?
A lender will use a serviceability calculator to assess your borrowing power and this will be based on your income and expenses. It will also factor in an estimate of living expenses and also a buffer on the interest rate to ensure you will be able to afford the repayments if the rates increased.

There are several factors that can affect how much you are allowed to borrow. These include personal loans, credit cards, interest free deals, HEC/HELP debts and other ongoing expenses such as school fees, gym memberships and phone contracts. In order to give yourself the best chance of being approved for a home loan, try to reduce the amount of debt you own and cancel any unnecessary expenses.

How much do I need to have saved?
The amount that you contribute will be used to cover two things: the upfront costs and your deposit for your share of the purchase price. Nowadays it is almost impossible to borrow all of the purchase price of a property so the absolute minimum contribution for most lenders is 5% of the purchase price. As this is your next home, you may potentially have either the proceeds of the sale of your last property, equity in another property that you can access or savings that you have accumulated which can be put towards the deposit.

Upfront costs will include things like stamp duty, your legal costs, pest and building inspections and other incidentals. Stamp duty calculators online can help you work out how much this will be in your state.

If you are well on your way to saving your share but need help to calculate exactly how much you will need, give us a call on 13 72 62 and we can work it out for you.

Where do you start?
A good thing to do right now is to have a chat with a professional who can answer any questions you may have. The friendly, experienced credit managers at State Custodians will provide helpful information without the pressure of committing and by the end of the conversation you will have a better understanding of what home loan would suit you the best. Give them a call during NSW business hours on 13 72 62 or drop them a note using an enquiry form.

Are home loans with the cheapest interest rates the best option?
If you are considering purchasing your next property, low interest rates are definitely an important factor when comparing home loans. You will also be comparing the features that come with the loan.

Your home loan is going to be a big part of your financial life for years to come so it makes sense to get one that is easy to use and will provide you benefits in both reducing the amount of interest that you pay and in making your life easier. State Custodians loans are designed with that in mind. If the cheapest home loans do not have the features that you really need, it may end up costing you more money over the life of the loan. The character of an award winning home loan is a loan that not only has a competitive interest rate, but quality features that will benefit your needs.