Buying a property is one of the biggest purchases we make in a life time.
There are many factors to consider before we take the big step from style, to suburb, to affordability.
One of the most important things to think about is your home loan, and what type of loan/mortgage you want or are able to pay off.
Read more from Argent Finance, Perth home loan brokers and finance specialists, on how to compare mortgage products.
Understanding the different types of home loans
Purchasing a property doesn’t have to be an unreachable wish, with the help of a reliable Perth home loan broker.
Here are the most common home loans available for paying off your mortgage:
- Variable rate loans
- Fixed rate loans
- Interest only loans
- Guarantor loans
- Low-doc loans
Which one is best for you? Let’s compare the mortgage products out there…
Comparing related mortgage offers
How do you compare and choose the home loan that’s best for you? Well, it’s wise not to go into the home loan process blind – do your research first!
Here are 4 ways to compare your home loan:
- Interest rate – Do you want variable or fixed rate?
- Repayment type – A principal-and-interest loan or interest only loan?
- Loan features – How about split rate, offset account, redraw, repayment holiday and/or portability?
- Loan type – Would a basic, standard, home loan package, line of credit, bridging or construction loan be the ideal fit?
A little confused? Don’t worry. Your Perth home loan broker and financial specialists will help you make sense of these terms and ensure you get the best loan feature(s) for you.
Knowing your budget and extra fees
Thankfully, there are low deposit home loans available which allows people to buy a property with only 5-10% deposit. However, if you do not wish to pay Lenders Mortgage Insurance, a 20% deposit is a good starting point.
For example, a 20% deposit of $400,000 Perth property is $80,000 – but with extra fees, this means your deposit is only just the beginning.
Fees you may not have considered:
- Application costs otherwise known as establishment or start-up fees.
- Valuation fees – involves getting the property assessed by a third party.
- Conveyancing charges and search processing fees – which cover the transfer of property title’s and title searches.
- Government and legal costs – including stamp duty on your mortgage, settlement agreements and contracts.
- Lenders Mortgage Insurance (LMI) – for purchasers borrowing more than 80% of the value of the property. For buyers wanting to avoid this cost, a deposit of 20% of the purchase price or more is required.
- Some home loans carry ongoing costs, such as: monthly service/annual fees, redraw and late payment fees, switching home loans, portability and discharge fees.
A tip from the team at Argent Finance is to account for more than just your deposit.
How your Perth home loan broker can help
Navigating the realm of property purchase doesn’t have to be a drawn-out and frustrating process. If you do your research before finding the home of your dreams and have the savings to boot, you’ll be climbing up the Perth property ladder in no time.
The team at Argent Finance are home loan finance brokers you can trust. We’re here to help you understand the process and get the best deal to make your property dream a reality.
Want to get in on the Perth property market? Contact Argent Finance today to start comparing mortgage options.