How Much Deposit Do I Need Before I Purchase A Real Estate!

 This will depend on the saving you have and  how much savings you are allocating towards your property purchased, allowing for what type of costs you will be incurring.

There is costs previously mentioned before: solicitors costs, Stamp duty, moving in costs and depending how much you borrow, you may be asked to take out mortgage insurance, based on the level of borrowings required against the purchase price.

So for example if you are purchasing a property for $430,000 in NSW the stamp duty cost is currently $14,840.00.

Click here for a sample of mortgage Stamp Duty Based on your area  *This calculator also calculates the mortgage registration fee and transfer fee.

Based on the level of borrowings against your purchase price, we will use 2 examples if you borrow $400,00 on the property purchase of  $430,000 - the extra mortgage insurance is $12,000. If is  borrowings of $43,000 and the purchase price is the same then
there is no mortgage insurance is usually payable for  loan to value ratio of 80 percent or below (always check with your mortgage lender to confirm).

Click Here for a Mortgage Insurance calculator


So this gives you and idea of what deposit is required. A suggestion is to get a pre-approval loan from your mortgage lender, before shopping around!

Budget Yourself And You Will Get There!

One important factor before purchasing your own property  is  a very strict budget must be adhered too , so that the mortgage payments are maintained.

Budgeting for yourself when you allocate funds for living expenses and  then mortgage some funds should be left over so that further savings can be raised for future lump sum payments or to cover an unexpected bill.

Even social expensive habits of cigarette or cigar smoking can affect your repayments if there is a lot used to purchase these items. If  this habit is not used their is a healthier lifestyle for that person/people which present a surplus financial gain to the household item, assisting in making repayments or making lump sum payments on the mortgage loan.

Lifestyle changes may be important too when budgeting as  a reasonable social life should not be ignored: entertainment and amusements, relaxations and having good times. A lot of people like to socialize, yet socializing can be expensive if it is extensive and ends up affecting your repayments to your mortgage.

Most people allocate funds for food and drinks for the week and what ever left over is allocated for bills, daily expenses, entertainment and  also mortgage.

Couples, I have found can possibly arrange their finances differently based on family commitments, compared to individuals that purchase properties.  If both parties are receiving approximately the same amount of income a strategy, could be put in place that one' income could pay the mortgage and if any left over  is paid into savings whilst the other income covers the daily living costs and anything after that could be placed into savings.

So if it takes a couple hours to discuss future budgets to purchasing  properties then this quality time used that assists yourselves in he initial decision making process.  Careful mutual consideration should be made on each part of the budget decisions are being made on and also encourage reviewing the budget even after purchase of the property has been made.