This sounds so simple and it is, yet a lot of us that want to purchase property (using loans) usually want to do it as quick as possible. The younger the better!
Generally that is the thumb rule, yet rushing into it without doing your own homework, may one day place you into deeper debt. So what I always suggest is whatever amount of the Home Loan interest is add at least, 5 percent worth and see with your income and expenses whether you would be able to pay this comfortably, This assuming interest rates where that high. That means check out your capacity to pay.
Ensure that if that if you are paying off your mortgage with your partner, should one of you lose income or have income reduced, you are both in a capacity to cover your mortgage repayments. The other thing you can do is add lump sum payments as you pay your account off and your withdrawal facility will increase, which can be used a s back up to cover income shortfalls!
If the house you are buying is not the house you want to purchase and you are having doubts because of all different variables then there a need to not proceed. Cut your small losses now, before it could escalate to be a lot bigger loss.
You have got to be really happy with the property you buy, if not you will be miserable and disappointed. Cheer up it is not all doom and gloom, there is an opportunity to delay buying and come back in a stronger financial time.
If there is any sort of doubt in purchasing a property, pull out immediately before mistakes could be made. I t is better to purchase a different property if you are not ready at a later time!
Thursday 31 October 2013
Tuesday 29 October 2013
Do You Trust Real Estates In What They Say To You - When Buying Property?
Every Real Estate Agent is a sales person and myself, as a former sales person (not Real Estate), I know we are talking to our potential customers as if we have the best product to sell.
Each agent is a human being like you and me. They have a job to do and yes they maybe looking after their own interest but the focus is getting you the property you wan to buy with them as well as the the best sell price for the seller. He or She is the go between buyer and seller, that is why they are called Agent.
An experienced Real Estate Salesperson will take time with each customer knowing how important it is to listen and then respond at the right time. They will provide their quality time to you so you get the service you desire.
Initially, you don't have to meet the agent to purchase real estate. With the electronic internet era we live in, the initial viewing of properties is done on the internet though websites like
Domain and Real Estate*. Here you will find they are user friendly, by search by area , type of property seeking and price range.
One you have found your lists of property then comes the chance to visit your Real Estate agent or contact first and then then visit, so you can view and prepare for the holding deposit.
Like everything in life, we judge people by their first reactions and agents will do the same. Some will treat you as a number, some may not have the time for you and fob you off and others will take that little extra interest in you.
If the agent is suggesting there is only one house available to see, that maybe only for that agency. Usually in non peak periods there are 8-9 house on the market ready to view but in a high buying market one on the market and next day sold. So you have to check the market for a week or and see how many properties are being sold or not, in that time.
If the agent has many properties to sell, he will ask you have you got any properties in mind?
If he or she takes you to see a property straight away then he or she has the time and not many other potential customers to show properties. Yet, if he refers to showings then he or she is limited in time to assist you. The keener you are the keener he or she is, to show you the property.
If you do not trust the real estate agent you meet, you may not have the confidence to purchase the property but consider this you are not buy the real estate agent you may be buying the property he is showing you!
Ask relevant questions regarding the property like is under rental, what are the local council zoning plans for the future, nearest shops, schools, churches, bus tops and train stations (if not known). You may need to ensure you mind is clear about the property. Legally you purchase the property the way you see it, so remember details of the property, so when final inspection comes any issues can be raised.
By this time, you will know whether what the agent is saying to you when purchasing the property.
If you do not make the decision by the end of the showing it was a waste of time for the agent but not for you!
*There maybe others but currently these are the mains websites to use, unless you choose others
Each agent is a human being like you and me. They have a job to do and yes they maybe looking after their own interest but the focus is getting you the property you wan to buy with them as well as the the best sell price for the seller. He or She is the go between buyer and seller, that is why they are called Agent.
An experienced Real Estate Salesperson will take time with each customer knowing how important it is to listen and then respond at the right time. They will provide their quality time to you so you get the service you desire.
Initially, you don't have to meet the agent to purchase real estate. With the electronic internet era we live in, the initial viewing of properties is done on the internet though websites like
Domain and Real Estate*. Here you will find they are user friendly, by search by area , type of property seeking and price range.
One you have found your lists of property then comes the chance to visit your Real Estate agent or contact first and then then visit, so you can view and prepare for the holding deposit.
Like everything in life, we judge people by their first reactions and agents will do the same. Some will treat you as a number, some may not have the time for you and fob you off and others will take that little extra interest in you.
If the agent is suggesting there is only one house available to see, that maybe only for that agency. Usually in non peak periods there are 8-9 house on the market ready to view but in a high buying market one on the market and next day sold. So you have to check the market for a week or and see how many properties are being sold or not, in that time.
If the agent has many properties to sell, he will ask you have you got any properties in mind?
If he or she takes you to see a property straight away then he or she has the time and not many other potential customers to show properties. Yet, if he refers to showings then he or she is limited in time to assist you. The keener you are the keener he or she is, to show you the property.
If you do not trust the real estate agent you meet, you may not have the confidence to purchase the property but consider this you are not buy the real estate agent you may be buying the property he is showing you!
Ask relevant questions regarding the property like is under rental, what are the local council zoning plans for the future, nearest shops, schools, churches, bus tops and train stations (if not known). You may need to ensure you mind is clear about the property. Legally you purchase the property the way you see it, so remember details of the property, so when final inspection comes any issues can be raised.
By this time, you will know whether what the agent is saying to you when purchasing the property.
If you do not make the decision by the end of the showing it was a waste of time for the agent but not for you!
*There maybe others but currently these are the mains websites to use, unless you choose others
Friday 25 October 2013
Where Do You Go For Finance To Purchase A Property?
This is an independent quest that really needs to b e answered by yourself and this is only to be used as a guide.
As a purchaser you cannot buy a property if you haven't done your financial homework. I mean walk into a real estate agent, pay the initial deposit (normally called a holding deposit) and find out no one or no banks, mortgage lenders and other financial institutions will provide you and/or your partner with a home loan. By doing this you have wasted your own time and also the Agents.
So after working out deposits saved (if any), and deducting all costs associated with the purchase of the property from the potential purchase price of the property. Then you do know how much you may need to borrow!
I have searched for list of banks, credit unions building so on the internet and have found an details on APRA (Australian Prudential Regulatory Authority Click Here for the List.
Also located Mortgage & Finance Association of Australia (MFAA) Click Here for details of MFAA
If there is a need search for for financial you can also explore them as well. One thing you need to keep in mind it they have to reputable and researched by yourself , so you are confident they will provide you with that home loan instead of going broke.
Obviously another rare financial lender could be members of your families, at least for a short term. A lot of families will be in a position to not to assist as they may not have the finances to assist. This is when this could make families be closer together or could also set them apart well apart if something goes wrong. The families that do decide to assist - must know what the situation happens if any or all borrowers are unable to assist with mortgage repayments.
Contingency plans must in place to ensure mortgage repayments are maintained , if not contract your lending creditor before any sale of your property also (known as foreclosure of property).
Some ideas of contingency plans could be selling your car, unused household items, stock market shares, using up any extra savings, renegotiating with other creditors reduce repayments under Financial Hardship', which could result being short term.
Also you need to ask your lender the obligation the creditor has if there is a default of payment on the loan due to reduced financial income and possible affects to the borrower if it happens and what can they do if 'Financial Hardship' occurs.
It is like this, most Australians do not ask many questions of borrowing a home and may not understand their full obligation, where as purchasing a car you will wan to ensure the car is in good working condition, warranty details (if any). Same with all the above mentioned banks and financial organisations you want to know how their loan insurance works, financial hard policy and also what happens if you pay extra payments.
Now it is up to you!
Also located Mortgage & Finance Association of Australia (MFAA) Click Here for details of MFAA
If there is a need search for for financial you can also explore them as well. One thing you need to keep in mind it they have to reputable and researched by yourself , so you are confident they will provide you with that home loan instead of going broke.
Obviously another rare financial lender could be members of your families, at least for a short term. A lot of families will be in a position to not to assist as they may not have the finances to assist. This is when this could make families be closer together or could also set them apart well apart if something goes wrong. The families that do decide to assist - must know what the situation happens if any or all borrowers are unable to assist with mortgage repayments.
Contingency plans must in place to ensure mortgage repayments are maintained , if not contract your lending creditor before any sale of your property also (known as foreclosure of property).
Some ideas of contingency plans could be selling your car, unused household items, stock market shares, using up any extra savings, renegotiating with other creditors reduce repayments under Financial Hardship', which could result being short term.
Also you need to ask your lender the obligation the creditor has if there is a default of payment on the loan due to reduced financial income and possible affects to the borrower if it happens and what can they do if 'Financial Hardship' occurs.
It is like this, most Australians do not ask many questions of borrowing a home and may not understand their full obligation, where as purchasing a car you will wan to ensure the car is in good working condition, warranty details (if any). Same with all the above mentioned banks and financial organisations you want to know how their loan insurance works, financial hard policy and also what happens if you pay extra payments.
Now it is up to you!
Friday 18 October 2013
Who Do You Consult Before Purchasing A Property?
This is a question that depends how strong emotionally and psychological you are.
Sometimes confusion can occur with the more people you speak too, but that is if you have never purchased a property before. Yet by talking to people and listening to different views, ideas you are then well adapted to start finding your new 1st home. Who knows you may purchase more properties later on.
Probably the most important people to speak too is your immediate family, like your parents, siblings and close friends if they have purchased a property before no matter how recent or long ago it was. Their stories will not necessarily end up as a duplicate copy of yours.
Obviously, joint discussions and reviews with your partner (if you have one) from other views or purchasing property can persuade you to alter the way you will decide to purchase property.
Solicitors, financial advisers, if you know builders (that could help), pest controllers, property house inspectors, financial lending institutions, local Council officers for checking the for and lastly real estate agents.
Real estate agents will invite you to visit the property (if you are so keen), after seeing it on the internet to check out the realty of the future property, you are prepared to purchase.
Every advice or discussion you have with people may or may not influence your decision but may assist you in your planning. Every decision you make must be made with with care, without haste and with a full commitment that you or you and your partner are financially viable to take on a property with a loan. If there is any slight doubt, pull out straight away. You can always purchase later, when you are all feeling 100 per cent confident that all will go well.
With every decision you make, there is that percentage of risk thus is your percentage of risk is little or none, that is the right time to purchase property. Good luck!
Sometimes confusion can occur with the more people you speak too, but that is if you have never purchased a property before. Yet by talking to people and listening to different views, ideas you are then well adapted to start finding your new 1st home. Who knows you may purchase more properties later on.
Probably the most important people to speak too is your immediate family, like your parents, siblings and close friends if they have purchased a property before no matter how recent or long ago it was. Their stories will not necessarily end up as a duplicate copy of yours.
Obviously, joint discussions and reviews with your partner (if you have one) from other views or purchasing property can persuade you to alter the way you will decide to purchase property.
Solicitors, financial advisers, if you know builders (that could help), pest controllers, property house inspectors, financial lending institutions, local Council officers for checking the for and lastly real estate agents.
Real estate agents will invite you to visit the property (if you are so keen), after seeing it on the internet to check out the realty of the future property, you are prepared to purchase.
Every advice or discussion you have with people may or may not influence your decision but may assist you in your planning. Every decision you make must be made with with care, without haste and with a full commitment that you or you and your partner are financially viable to take on a property with a loan. If there is any slight doubt, pull out straight away. You can always purchase later, when you are all feeling 100 per cent confident that all will go well.
With every decision you make, there is that percentage of risk thus is your percentage of risk is little or none, that is the right time to purchase property. Good luck!
Thursday 10 October 2013
When Is The Right Time To Buy?
The answer to 'When is it the right time to buy?' can only be answered by yourself*. The simple answer is when you are ready!
Many factors can make your decision or joint decision with your partner, but the decision must be made with care and consideration to others.
The factors that can made your decision are the following: cost of the property, savings obtained, interest rates, cost towards renovating if required before moving and the estimated property value after any capital expenditure has been made to improve the residence. Will you live in it straight away or will you rent it out? Have you got enough funds to cover the mortgage repayments plus (for example) and repayments that would cover an additional 5 per cent**.
THE FACTORS:
Cost of Property:
This is depends on what amount are to prepared to spend based on what properties are available and your maximum purchase price you will pay. Also, how much of the purchase price will you need to borrow and how much deposit will be used without borrowings from acquired savings?
You also would have budgeted to cover further costs and covering Home Loan repayments, that occur as soon as property is settled.
Click for costs before purchasing a property
Will you purchase free of the market or via auction sales. A lot of people thin with an auction that you have to wait until the day of auction to purchase it. No, you can make a reasonable offer and it may be accepted by the purchaser - then it is pulled away from the auction sale.
If in any doubt, then it may not be the right time to do it and it can be revisited when you are fully prepared.
Also with your partner time has to be set aside so that you are both happy with they will be purchasing financially. It is not good if one party is sad and not ready for it!
*yourself - may included any other partners prepared to enter into Home Loan agreement.
Savings Obtained
The simple policy is the more you save the less you borrow from financial institutions! A good policy is to provide deposits on Home Loans of minimum 20-25% - thus reducing your lending amount.
So imagine if the property you want to purchase is worth $500,000 and you have now saved up $200,000 then your required borrowings and repayments will be reduced. Some financial institutions provide 100 per cent Home Loans - these provide potential risks for the borrower/s as if there is a default in repayments, in due time there could be a foreclosure sale of the property and you will be left with a residual amount to pay back. This could also happen whilst paying any deposit, yet the residual balance would be reduced compared to nil deposit.
Yet, the question always raised while saving for the deposit, is this the right time to buy? That depends if enough deposit satisfies yourself to purchase your own property.
Saving is easy as you make financial conservative decisions that allow you to positively save hard, the more save the easier it will be to purchase the property you want. Steer away from families/ friends providing you with loans and this can lead into possible disputes in the long run - where you may need family /friend support later on.
Interest
Interest can be interesting to work out on what home loan is the best to use to suit the type of property amount you will purchase. Keeping in mind that interest rates fluctuate month to month based on Australia's Reserve Bank Board setting the cash rates, which will determine your current rate of interest charged, unless you have locked in interest is part of or full interest rate.
There is standard variable interest rates which will start off at a reasonable interest rate for a locked in period of years, and then it will jump up to the standard variable interest rate, which will offer redraw, top up and allowing extra/lump-sum payments to be made. An option maybe to offer to change to a fixed interest rate Home Loan.
Basic variable rate is a variable rate of interest but with limited transaction there may be little or no provisions that the standard variable interest rates provide.
Fixed Interest rates are what they are fixed rates for the term of the loan. This is good when interest rates are high and your your is fixed at a lower rate but can be disastrous if current interest rates are low and you are repaying back at a higher rate of interest.
Combinations of standard variable interest rates and fixed interest rates can be provide on your home loan account, this can be used if you want to use both methods of repaying interest to suit your current and future lifestyle.
Interest Only Home Loans are generally used for purchasing properties with high values. At the end of the Home Loan the remaining principal is paid, some interest only Home loan can also include reducing the a bit of the principal as well.
Does this all sound interesting to you now?
Moving costs/Renovating before you move in:
Before you purchase the property, there maybe decisions to be made based on how the property appears and if there any improvements/renovations required to be done before you move in.
A lot of people under budget on these renovations, so it is important to add at least around 20 percent extra just in case further funds will be required. The unused funds, if any, (on completion of the renovation) can then be applied to reduce the mortgage. Which is a great benefit to yourself.
It depends on what is required. Some houses area ready made houses and that makes it easy, leaving a quick 'spring clean' before you move in.
Some houses may need painting done to change dislike wall colors, a change in room designing - can be costly especially if not really required. Additional costs prior to moving should be limited, if the house is in need to be repaired and renovated and it is substantiated, then go ahead and proceed with it.
So by the time you decide to buy you will know when the right time to purchase a property.
*Yourself - includes your partner. ** the percentage depends of how conservative are with your expenses, even working on a higher percent and the funds are available to cover the extra percentage that places you in a very strong stance to cover future interest rate rises.
Many factors can make your decision or joint decision with your partner, but the decision must be made with care and consideration to others.
The factors that can made your decision are the following: cost of the property, savings obtained, interest rates, cost towards renovating if required before moving and the estimated property value after any capital expenditure has been made to improve the residence. Will you live in it straight away or will you rent it out? Have you got enough funds to cover the mortgage repayments plus (for example) and repayments that would cover an additional 5 per cent**.
THE FACTORS:
Cost of Property:
This is depends on what amount are to prepared to spend based on what properties are available and your maximum purchase price you will pay. Also, how much of the purchase price will you need to borrow and how much deposit will be used without borrowings from acquired savings?
You also would have budgeted to cover further costs and covering Home Loan repayments, that occur as soon as property is settled.
Click for costs before purchasing a property
Will you purchase free of the market or via auction sales. A lot of people thin with an auction that you have to wait until the day of auction to purchase it. No, you can make a reasonable offer and it may be accepted by the purchaser - then it is pulled away from the auction sale.
If in any doubt, then it may not be the right time to do it and it can be revisited when you are fully prepared.
Also with your partner time has to be set aside so that you are both happy with they will be purchasing financially. It is not good if one party is sad and not ready for it!
*yourself - may included any other partners prepared to enter into Home Loan agreement.
Savings Obtained
So imagine if the property you want to purchase is worth $500,000 and you have now saved up $200,000 then your required borrowings and repayments will be reduced. Some financial institutions provide 100 per cent Home Loans - these provide potential risks for the borrower/s as if there is a default in repayments, in due time there could be a foreclosure sale of the property and you will be left with a residual amount to pay back. This could also happen whilst paying any deposit, yet the residual balance would be reduced compared to nil deposit.
Yet, the question always raised while saving for the deposit, is this the right time to buy? That depends if enough deposit satisfies yourself to purchase your own property.
Saving is easy as you make financial conservative decisions that allow you to positively save hard, the more save the easier it will be to purchase the property you want. Steer away from families/ friends providing you with loans and this can lead into possible disputes in the long run - where you may need family /friend support later on.
Interest
Interest can be interesting to work out on what home loan is the best to use to suit the type of property amount you will purchase. Keeping in mind that interest rates fluctuate month to month based on Australia's Reserve Bank Board setting the cash rates, which will determine your current rate of interest charged, unless you have locked in interest is part of or full interest rate.
There is standard variable interest rates which will start off at a reasonable interest rate for a locked in period of years, and then it will jump up to the standard variable interest rate, which will offer redraw, top up and allowing extra/lump-sum payments to be made. An option maybe to offer to change to a fixed interest rate Home Loan.
Basic variable rate is a variable rate of interest but with limited transaction there may be little or no provisions that the standard variable interest rates provide.
Fixed Interest rates are what they are fixed rates for the term of the loan. This is good when interest rates are high and your your is fixed at a lower rate but can be disastrous if current interest rates are low and you are repaying back at a higher rate of interest.
Combinations of standard variable interest rates and fixed interest rates can be provide on your home loan account, this can be used if you want to use both methods of repaying interest to suit your current and future lifestyle.
Interest Only Home Loans are generally used for purchasing properties with high values. At the end of the Home Loan the remaining principal is paid, some interest only Home loan can also include reducing the a bit of the principal as well.
Does this all sound interesting to you now?
Moving costs/Renovating before you move in:
Before you purchase the property, there maybe decisions to be made based on how the property appears and if there any improvements/renovations required to be done before you move in.
A lot of people under budget on these renovations, so it is important to add at least around 20 percent extra just in case further funds will be required. The unused funds, if any, (on completion of the renovation) can then be applied to reduce the mortgage. Which is a great benefit to yourself.
It depends on what is required. Some houses area ready made houses and that makes it easy, leaving a quick 'spring clean' before you move in.
Some houses may need painting done to change dislike wall colors, a change in room designing - can be costly especially if not really required. Additional costs prior to moving should be limited, if the house is in need to be repaired and renovated and it is substantiated, then go ahead and proceed with it.
So by the time you decide to buy you will know when the right time to purchase a property.
*Yourself - includes your partner. ** the percentage depends of how conservative are with your expenses, even working on a higher percent and the funds are available to cover the extra percentage that places you in a very strong stance to cover future interest rate rises.
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