Buying your first property is an exciting decision that involves a significant amount of research and planning.  

As a first-time home buyer, it can be difficult to know where to start and the process involved in buying a property.  

To make it easier, we’ve created a handy list of things to consider and steps you may need to take along the way.

- __Related:__ [FREE E-BOOK: How to buy a house in 9 SIMPLE steps](https://www.lendi.com.au/inspire/property/free-ebook-how-to-buy-a-house-9-steps/)
- __Related:__ [6 tips for saving a home loan deposit](https://www.lendi.com.au/inspire/finance/6-tips-for-saving-a-home-loan-deposit/)
- __Related:__ [What to consider before buying property in a regional area](https://www.lendi.com.au/inspire/property/how-australian-regions-are-leading-house-price-growth/)

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## 1. Start saving a home loan deposit 

Ideally, when buying a property you’ll need a deposit of 20% or more of the purchase price of the property.  

While it’s still possible to buy a property with a lower deposit, this could mean you’ll have to pay [Lender’s Mortgage Insurance (LMI)](https://www.lendi.com.au/home-loans/lmi/), another cost you’ll need to cover. 

> 💡__ Did you know?__ LMI was created to protect the lender in case the borrower is not able to	make their repayments.  

Having a lower deposit could also mean you won’t have access to competitive rates and may end up paying more in interest over the life of your loan.  

By saving a higher deposit, you lower your [Loan to Value Ratio (LVR)](https://www.lendi.com.au/home-loans/lvr/).  

> __LVR = Outstanding loan amount / Value of property) x 100 __

Generally, borrowers with an LVR of 80% or lower are considered a lower risk in the eyes of lenders. 

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## 2. Find out your budget 

As great as it would be to buy a waterfront mansion, it may not be a financially savvy option for everyone. 

It’s important to understand your borrowing capacity and have a budget in place to avoid any unsavvy financial decisions that could cause you [mortgage stress](https://www.lendi.com.au/inspire/finance/what-mortgage-stress-is-how-to-avoid-it/).  

Take a step back and budget. Remember that beyond the house price itself and paying off the home loan, there are other [upfront costs](https://www.lendi.com.au/inspire/property/a-guide-to-the-upfront-costs-of-buying-a-home/) such as [property inspections](https://www.lendi.com.au/inspire/property/guide-to-building-pest-strata-inspections/), [stamp duty](https://www.lendi.com.au/home-loans/stamp-duty/) and [conveyancing fees](https://www.lendi.com.au/inspire/property/how-conveyancing-works-and-how-much-it-costs/) to name a few. 

> 💡 __Savings tip:__ If you are serious about buying a property, it’s important to take a good hard look at your savings, assets, debts and liabilities. 

Having an updated record of your savings, income and spending can help you find unexpected ways to save and eliminate any unnecessary expenses. 

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## 3. Get expert help to make things easier 

### Get help from a mortgage broker 

A common misconception is that mortgage brokers charge hefty fees for their services. In reality, many don’t charge a fee at all, so you won’t be out of pocket for getting home loan help. 

Not only are many mortgage brokers and home loan specialists free to use (including our own), but they’re also a valuable resource to help you navigate the world of property. 

Have a question about interest rates? They can share about how interest rates will affect your repayments and loan term. 

Unsure about whether to get a fixed, variable or split rate? Based on your situation, goals and preferences, they’ll be able to share which may be most suitable for your needs. 

%%Book a chat with a Home Loan Specialist%% 

### Hire a real estate agent 

While mortgage brokers are experts in the field of home loans, real estate agents will be able to provide more detailed insights into specific areas and suburbs. 

Real estate agents are the pros when it comes to the property market and have oversight on what properties are selling, where they’re selling and for how much. 

They will typically be able to help you with: 

- Finding properties that meet your criteria and budget  
- Getting information on average property prices and recent sales 
- Learning more about different suburbs 
- Bidding at auction 
- Price negotiations 
- Closing the deal when you buy a property 

The level of involvement of a real estate agent can vary and will determine their service fee. 

### Get advice from a financial advisor  

Much like mortgage brokers and real estate agents are experts in their respective fields, financial advisors will be able to give you financial advice and help manage aspects of your finances. 

Mortgage brokers and real estate agents should not be giving out financial advice, but a financial advisor can do this and help you make informed financial decisions.  

Financial advisors can:  

- Offer advice on how to improve your financial situation 
- Create a financial strategy to help you achieve your goals 
- Advise you on potential investment opportunities  
- Work on tax planning to reduce your tax paid 
- Review your financials, such as insurance, debts, investments and so on. 

If you’re looking for expert advice regarding your financial health, a financial advisor is the expert to turn to.  

![Asset | The beginner's guide to buying your first home | Call a mortgage broker](//images.ctfassets.net/o2gysnvd04sg/27qkbFi9PXPO6DX1RyDihJ/4597d45a2d8a32e8a2a526208b861e4a/_832x468px__6_.jpg) 

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## 4. Review your credit report and find out your credit score 

Your [credit score](https://www.lendi.com.au/inspire/finance/how-a-credit-report-affects-a-loan-application/) is an indicator of your credit history. Lenders will look at your credit score when you apply for a home loan to gain an insight into what kind of borrower you are.  

The higher your credit score, the more trustworthy you appear as a borrower. 

Checking your credit score is vital when you are a first-time buyer, as an unblemished credit score will make the home loan application process easier.  

You can improve your credit score by making sure that you pay all bills and credit cards on time and minimise your debt. 

It may be a good idea to examine your creditworthiness yourself during the early stages of the home loan process.  

> 💡 __Did you know?__ You can obtain a free copy of your annual credit report from an online provider. 

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## 5. Get pre-approved before you start your search 

Before you start the search for a property, it may be a good idea to [get pre-approved](https://www.lendi.com.au/inspire/finance/how-do-you-get-pre-approved-for-a-home-loan/). 

[Home loan pre-approval](https://www.lendi.com.au/home-loans/pre-approval/), also known as approval in principle, is an indication of how much a lender may be willing to lend you.  

While getting pre-approved isn’t necessary to buy a home, it comes with several benefits including: 

- It’s free to [get pre-approved ](https://www.lendi.com.au/inspire/finance/how-do-you-get-pre-approved-for-a-home-loan/)
- It gives you a better idea of how much a lender will be willing to lend you before you commit to buying a property 
- It is valid for up to 6 months, giving you peace of mind during your property search 
- Pre-approval time can be extended if requested before the expiry date 
- It allows you to attend and [bid at auctions](https://www.lendi.com.au/inspire/property/how-to-buy-a-house-at-auction/) with confidence, knowing what you’ll be able to afford  
- Vendors tend to favour pre-approved buyers as they can potentially settle sooner 

%%Wondering how much you could borrow?%% 

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## 6. Check if you’re eligible for any government grants 

With housing affordability dropping, both federal and state governments have introduced [several initiatives](https://www.lendi.com.au/inspire/property/labor-government-plans-to-support-housing-affordability/) to help home buyers purchase their first property.  

You might be eligible for a number of [first home buyer grants](https://www.lendi.com.au/inspire/finance/grants-concessions-first-home-buyers/) that can help you save and potentially get you on the property ladder sooner than you expect.  

For example, the [First Home Owner Grant](https://www.lendi.com.au/home-loans/first-home-owner-grant/) was introduced in July 2000 to provide first home buyers with additional funds to buy or build their first home. The grant is available nationwide and each state or territory has its own legislation for the scheme. 

If you qualify, this boost could be contributed to your 20% deposit, for example, and could help you avoid paying [LMI](https://www.lendi.com.au/home-loans/lmi/).  

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## 7. Search for your property 

### Research areas and suburbs  

Where you live can be just as important as the property itself. You may love a house, but if it’s too far from work, schools, family, amenities or facilities, the vision of living in your dream property might not match your experience. 

It’s a smart idea to find suburbs of interest that will fulfil your needs – whether that be close to schools for the kids or near public transport for work. It may also be worthwhile to consider crime rates and noise levels. 

It could also be a great idea to visit different areas over the weekend or after work. This will allow you to scope out the nearby facilities and give you a better understanding and feel for the area.  

%%Get a free property report in seconds%% 

### Choose the right property for your needs 

While it’s easy to get swept away by modern interiors, well-kept gardens and renovated spaces, it’s important to consider your future plans when choosing a property.  

Do you see yourself married with children and wanting to settle in one area any time soon? Do you want to be able to upsize and move to a different location in a few years? 

As tempting as jumping on the property ladder can be for first-time buyers, it’s important to plan ahead. Think about whether you see yourself living there in the future and what type of space will accommodate your needs.  

Although things can always change, at least you’ll know you haven’t blindly jumped into a home purchase and possibly your biggest expense. 

### House or apartment?

The type of property is also important to think about. Do you prefer apartment living in the city? Perhaps a house in the suburbs?  

Between detached and semi-detached houses, townhouses, villas, units (and the list goes on), there is plenty to think about.  

### Build or buy?

You’ll also need to choose between a [new or established home, or building your own](https://www.lendi.com.au/inspire/property/is-it-better-to-build-or-buy-a-house-in-australia/).  

If you’re interested in buying a property that needs a little TLC, you may have to budget the funds for renovations and consider timings. 

If you’re buying a new home, you may need to take the time to save up a hefty deposit to avoid LMI. 

Or if you’re building a home, [buying off the plan](https://www.lendi.com.au/inspire/property/your-guide-to-buying-off-the-plan/) or buying a [house and land package](https://www.lendi.com.au/inspire/property/guide-to-house-and-land-packages/) you might want to weigh the [risks vs benefits](https://www.lendi.com.au/inspire/property/is-it-worth-buying-off-the-plan-risks-and-benefits/). 

It’s also good to be aware that there are certain property types that lenders may be hesitant to finance, also known as ‘[risky properties](https://www.lendi.com.au/inspire/finance/the-risky-property-types-banks-prefer-not-to-finance/).’ 

![Asset | The beginner's guide to buying your first home | Property search](//images.ctfassets.net/o2gysnvd04sg/4xpgn3vraG2ZICydCmmWps/0a040ca41a7d816090af43035f1a29bc/_832x468px__7_.jpg)

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## 8. Set up the right inspections before you make a purchase 

Before you put down a deposit on a property, it might be worthwhile setting up a [building and pest inspection](https://www.lendi.com.au/inspire/property/guide-to-building-pest-strata-inspections/) to make sure the property is structurally sound and pest-free.  

A second perspective will help you find any faults or issues you might have missed. Pest inspections can save you a lot of money in future repairs and avoid health and safety hazards.  

If you do find a fault in the property that’s not a dealbreaker, you’ll have the opportunity to [negotiate](https://www.lendi.com.au/inspire/property/10-property-buying-negotiation-tips/) the purchase price down. 

Buying a property before taking these precautions can put you at risk of having to spend more money down the track. 

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## 9. Make an offer  

After you’ve taken the steps above in preparation and have found the property you’d like to buy, it’s time to make an offer. 

If you’re thinking of attending auctions, it’s useful to know that buying through auctions means you won’t have a cooling-off period to change your mind if you’re the highest bidder. 

Learn more about [buying at auction here](https://www.lendi.com.au/inspire/property/how-to-buy-a-house-at-auction/). 

If you’re buying through a private sale, also known as a private treaty, you may be able to negotiate the cooling-off period. But be aware that you may be ‘gazumped’ if another interested buyer swoops in with a higher offer before you have a chance to seal the deal. 

Learn more about the [differences between auctions and private sales here](https://www.lendi.com.au/inspire/property/auction-vs-private-sale-how-to-buy-property-in-australia/). 

It’s good to ensure that before you get to this point, you are pre-approved for a home loan. This will give you peace of mind knowing you’re only putting offers in for properties you’ll be able to afford. 

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## 10. Close the deal 

When your offer has been accepted, it’s time to pay your deposit and receive the contracts.  

It’s good to err on the side of caution and have a solicitor or conveyancer review these contracts and all the relevant documentation before you sign. This is also the time when your solicitor or conveyancer will get you formal approval, also known as [unconditional approval](https://www.lendi.com.au/inspire/finance/conditional-vs-unconditional-home-loan-approval/). 

On settlement day, the lender will pay the seller and you’ll need to pay any final costs like stamp duty.  

If you experience any delays during settlement, [here’s what you can do](https://www.lendi.com.au/inspire/finance/property-settlement-delays-what-to-do/). 

Not long after, you’ll get the keys to your new home and start making your repayments. 

If you’re ready to buy your first home, the Lendi experts are here to help for free. Simply [book an appointment](https://www.lendi.com.au/book-appointment/) to chat options, ask questions and get the process started.

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## What could your home loan repayments look like?

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## Got a home loan question? Just ask!
We're here to help. Get free expert advice at a time that suits you. Choose a time to chat with a [Home Loan Specialist here](https://www.lendi.com.au/book-appointment/)

*The information in this post is general in nature and should not be considered personal or financial advice. You should always seek professional advice or assistance before making any financial decisions.*

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