Buying your first home is an exceedingly exciting and pleasing time, as well as a significant commitment. Because there’s a lot of information out there, we can help sort fact from fiction and dismiss some of the common myths to help you make smarter property decisions.

It’s always best to buy at auction: not true

Neither buying at auction or private treaty is better than the other to purchase property. They are simply different routes to the same end goal, with different factors to consider and prepare for. If you buy at auction, the asking price is not known, whereas if you buy by private treaty there is a set sale price. Auctions are usually more common in urban areas of our larger cities to take advantage of the increased level of competition that exists between buyers. You'll need a big deposit: not true

If you’ve managed to save enough money to pay a deposit on your first home without lenders mortgage insurance, congratulations! You are going to be in the minority in any case. If you haven’t, home ownership could still be within your reality. If your savings amount is less than 20% of the purchase price of your new home, you may be able to borrow a little more, provided you take have Lenders Mortgage Insurance (LMI) which protects the lender against the risk of providing you with a loan in the event that you can’t repay it. As the cost of your LMI will be added to your total loan amount, you won’t be hit with extra upfront costs. It is difficult to pass the mandatory credit check: not true

Any time you apply for a credit product, such as a loan, electricity account or a credit card, the company in question will check your credit rating. This is a report containing information about any applications you have made for credit during the past five years, and includes information such as what accounts you have, whether you pay your bills on time, and any defaults (debts you haven’t paid). As long as you’ve paid all your debts, or have a good reason for not paying those that you haven’t, your credit rating shouldn’t affect your ability to get a home loan. Once you have a home loan you are locked in for years: not true

You can’t always plan ahead for life milestones like an expanding family, a promotion or change in your employment situation. That’s why flexibility is part of the loan recommendation process we engage in with our clients. Features such as repayment holidays, offset account and redraw are two of the options your home loan may have, that could help you manage your home loan when your situation changes.

Talk to us if you need to know more …