Buying a home in Western Australia is a significant financial commitment. Whether you are purchasing your first property, upgrading, investing or refinancing, understanding the lending process, loan features, costs and lender requirements may help you make more informed decisions.
FinanceCorp provides credit assistance by gathering information about a consumer’s requirements, objectives and financial situation and explaining and comparing available lending options from its lender panel, subject to broker accreditation and lender criteria.
Understanding these issues before inspecting properties or making an offer may help borrowers develop more realistic expectations about borrowing, repayments and purchase costs.
Consideration #1: Searching for a Home Before Knowing Your Borrowing Capacity
Some WA buyers begin searching for property before obtaining an indicative understanding of how much they may be able to borrow. This may lead them to consider properties outside the indicative price range supported by the information available at that time.
Your borrowing capacity depends on more than just your income. Lenders assess factors such as your living expenses, existing debts, employment situation, credit history, savings, deposit size, and their own lending criteria.
Many buyers assume their borrowing power will be the same with every lender. Different lender policies may produce different indicative borrowing outcomes, available products and assessment requirements.
Obtaining an indicative understanding of borrowing capacity may help buyers set more realistic expectations about possible purchase prices and repayments.
A mortgage broker can gather information about your financial position, provide credit assistance and explain how different lenders may assess an application. Any indicative assessment remains subject to lender assessment, approval and criteria.
Consideration #2: Choosing a Home Loan Based Only on the Lowest Interest Rate
The interest rate is one consideration when comparing home loans. Other factors may include fees and charges, comparison rates where applicable, repayment arrangements, lender policies and available loan features.
Features such as an offset account, redraw facility or additional repayment option may work differently between products and may involve conditions or fees. Their usefulness will depend on how the feature is used and the borrower’s circumstances. Availability of loan features varies between lenders and products.
Factors that may be relevant when comparing available loan options include:
- How the loan features work and whether they relate to the borrower’s stated requirements and objectives
- The flexibility available if their circumstances change
- The overall cost of the loan, including fees and charges
FinanceCorp provides credit assistance by gathering information about a consumer's requirements, objectives and financial situation before explaining and comparing available lending options from its lender panel, subject to lender criteria.
A mortgage broker may compare available options from the lenders on their panel, subject to broker accreditation, lender criteria and the consumer’s circumstances.
Consideration #3: Underestimating the True Cost of Buying a Home
Many buyers focus heavily on saving for a deposit but overlook the additional expenses involved in purchasing property.
The purchase price of the home is only one part of the overall financial commitment. Additional costs can quickly add up, and failing to budget for them can create financial pressure after settlement.
Some expenses buyers should consider include:
- Building and pest inspections
- Conveyancing and settlement costs
- Government charges and applicable duties
- Loan fees, insurance, moving expenses, and initial property costs
This is particularly important for first home buyers who may already be using a large portion of their savings to enter the property market.
Buyers may also wish to consider ongoing property and household costs when preparing their purchase budget.
Considering upfront and ongoing costs may help buyers prepare a more complete purchase budget. Actual costs will depend on the property, transaction and individual circumstances.
FinanceCorp can explain lending-related costs and information commonly considered during the loan process. Legal, taxation and conveyancing matters should be discussed with appropriately qualified professionals.
Consideration #4: Making Major Financial Changes During the Home Loan Process
Changes to employment, income, liabilities, expenses or credit commitments during a home-loan application may affect the lender’s assessment.
Some borrowers take on new debts or make other financial changes while an application is being assessed. These changes may affect the lender’s servicing assessment or require further information.
Examples of changes that may impact your application include:
- Taking out a new car loan or personal loan
- Increasing credit card balances
- Changing employment circumstances
- Reducing your income or increasing financial commitments
Even if you have received conditional approval or pre-approval, lenders may reassess your financial situation before final approval and settlement.
For example, purchasing a large item using credit before settlement may affect your borrowing position. Similarly, changing jobs could require additional assessment depending on your circumstances.
Borrowers should disclose material changes to their broker and lender promptly.
Before taking on new credit or making a significant financial change during an application, borrowers may wish to ask their mortgage broker how the lender may treat the change. The lender may require further information or reassessment.
Consideration #5: Waiting Until You Find a Property Before Seeking Credit Assistance
Many buyers believe they only need a mortgage broker after they have found a property they want to purchase.
Speaking with a mortgage broker earlier may help buyers understand indicative borrowing capacity, the information commonly requested by lenders, and the loan application process before making an offer.
A mortgage broker may assist by:
- providing an indicative understanding of borrowing capacity based on the information available
- explaining and comparing available options from their lender panel
- helping organise documents and information commonly requested during a loan application
FinanceCorp provides credit assistance based on information gathered about each consumer’s requirements, objectives and financial situation.
FinanceCorp assists with lending enquiries relating to first-home purchases, refinancing, investment property and home upgrades, subject to broker accreditation and lender availability.
How FinanceCorp Cockburn Helps WA Buyers Through the Home Loan Process
The home loan process can feel complicated, especially when you are dealing with unfamiliar terms, lender requirements, and major financial decisions.
A mortgage broker can explain the application process, gather information and documentation, compare available options from their lender panel and communicate with the selected lender.
FinanceCorp provides credit assistance based on information gathered about each consumer’s requirements, objectives and financial situation.
The team works with a range of clients, including first home buyers, families looking to upgrade, property investors, and homeowners wanting to refinance.
Every buyer has different priorities. Some want lower repayments, some want greater flexibility, and others want a loan structure that supports future plans.
These priorities form part of the information considered when a mortgage broker provides credit assistance.
Prepare for the Home Loan Process
Buying a home can seem complex, however understanding the lending process beforehand may assist borrowers in preparing for the purchase process.
Understanding indicative borrowing capacity, loan features, fees, purchase costs and lender requirements may help buyers prepare before making a property offer.
FinanceCorp provides credit assistance by gathering information about the consumer’s requirements, objectives and financial situation and explaining and comparing available options from its lender panel. Available options remain subject to broker accreditation, lender criteria, assessment and approval.
Contact FinanceCorp to discuss your lending enquiry and the home-loan application process.
Frequently Asked Questions
When should I speak with a mortgage broker when buying a home?
Some buyers choose to speak with a mortgage broker before beginning their property search so they can obtain an indicative understanding of borrowing capacity, lender requirements and the application process.
Is the lowest interest rate always the best home loan option?
Not necessarily. The interest rate is one consideration. Borrowers may also consider comparison rates where applicable, fees, loan features, repayment arrangements and lender policies. FinanceCorp considers the consumer’s requirements, objectives and financial situation when providing credit assistance.
Can FinanceCorp help first home buyers?
FinanceCorp may provide credit assistance to first-home buyers, subject to broker accreditation, lender availability and the consumer’s circumstances. This may include explaining indicative borrowing capacity, lender requirements, available lender-panel options and the home-loan application process.
What information may lenders consider when assessing a home loan application?
Lenders may consider income, employment, expenses, liabilities, credit history, deposit size, loan purpose and other matters under their credit policies. Requirements vary between lenders, and approval is not guaranteed.
Why use a mortgage broker instead of going directly to a bank?
A bank can generally discuss its own products, while a mortgage broker may compare available options from the lenders on the broker’s panel. The range of lenders and products available will depend on the broker’s accreditations, lender panel and the type of lending requested.
Important information: This article provides general information for educational purposes only. It does not take into account your objectives, financial situation, needs or borrowing requirements and is not a recommendation to apply for any particular loan, lender or credit arrangement.
FinanceCorp provides credit assistance under Australian Credit Licence 395037. The lenders and products considered depend on broker accreditation, lender-panel access, the type of lending requested, the information provided and the consumer’s circumstances. FinanceCorp does not compare every lender or loan product in the market.
Any references to borrowing capacity, repayments, interest rates, loan features, lender policies, property costs or market conditions are general or indicative only and may change. Any borrowing estimate or scenario is indicative only and should not be relied upon as an indication of loan approval or a future lending outcome.
All lending is subject to applicable enquiries, verification, preliminary assessment, lender criteria, approval, terms, conditions, fees and charges. Seek assistance from appropriately qualified financial, legal, taxation, property or credit professionals where required.
