Article: Law & Finance
Advice For Hopeful Home Buyers with David Ryburn
First Home Buyers – Is This A Good Time To Buy?
Indications are that home loan affordability is improving in Northland. This is mainly due to the number of houses available for sale combined with property values having been in decline across the region. This means there could be some great buys available for first home buyers. While there are signs that house prices could stabilise, it still takes less income to service a home loan on an average priced house than it did a year ago.
It may be possible to obtain 6 month home loan pre-approval from your bank which gives you plenty of time to find your dream home.
Deposit Size And Pre-Approval
As with all services it pays to do your research to find a bank that best suits your needs. Banks can offer flexibility around your deposit size, taking all applications on their own merit. If your combined income is pretty healthy but your deposit isn’t quite there your bank may still consider lending it to you. It depends on a number of factors so it’s best to talk to your bank to see what can be done.
With home loan pre-approval, you know how much you can borrow before you go house hunting – meaning you can shop with confidence. Mortgage managers look at your whole budget i.e. deposits, earnings, debt and outgoings. If you are not sure if you qualify, it’s worthwhile having a chat with a Mortgage Manager about your home loan requirements.
Floating Or Fixed Interest Rates?
In these volatile times, it’s difficult to try and predict where interest rates are going. To get the best of both worlds, you might want to split your loan in different chunks with a mix of fixed rate and a floating rate as well.
For example, you could put 50% of the total loan on a long term fixed rate, 40% on a shorter term fixed rate, and lave 10% floating so you can make extra payments at any time on that portion.
Or you could put part of your loan on fisted rate interest-only, and the rest on a standard floating home loan where the balance reduces over time. You can then focus on the floating amount, paying it off as fast as possible.
How To Access Information
Websites and publications specialising in financial matters are valuable tools when it comes to doing your research, but nothing beats a face to face chat. This can be achieved by calling a Mortgage Manager to make an appointment.
