Home ownership is something that many people aspire to have once they reach their 20s and 30s. However, the sheer volume of paperwork that’s involved, and all the expert assistance you may require, can put you off. Why does securing your dream home have to be so hard?
Below, we cover the five steps to take to buy your dream home - including how to get low deposit home loans.
Step 1: Secure a Home Loan
Banks can make it quite tricky to get a home loan. In many cases, you need as much as 20 percent for a deposit. Not everyone can scrape together $40,000 on a $200,000 loan for their dream property. By the time they do, it’s often long gone.
In 2019, the median house price in New Zealand was $585,500, making it nearly impossible for many young Kiwis to get the house they deserve. Too many hoops to jump through can have them stuck in the renting cycle forever. However, the first step of buying your first home is to secure the money, and non-bank lenders might be able to help.
Many non-bank mortgage brokers and lenders can fight for the best deal while working through the reasons why a traditional bank turned you away. Don’t let your bank’s answer be the final one. Talk to a non-bank lender and find out what they can do for you.
Step 2: Start Property Searching
If you didn’t have a specific property in mind, then the second step is to begin looking for one. Now that you have approval for a low deposit home loan, the fun part can begin. You can start going to open homes and browse the internet to see what’s available.
There are several websites dedicated to showing the latest property listings on the market. While you’re on the hunt, sign up for new listings that meet your criteria to be sent to you via email. You may also like to get in touch with local real estate agents who can show you the properties they have available.
Step 3: Checks
Once you think you’ve found the property of your dreams, it’s time to carry out all the checks and reports. The house might look good on the surface, but how do you know it’s not riddled with faults underneath? A property needs to have good bones to ensure it’s worth what you’re willing to pay.
Building and LIM reports are all part and parcel of potential home ownership - whether you buy with a low deposit home loan or not. Don’t forget to do all your due diligence before you sign on the dotted line. It can save you a lot of heartache further down the line.
Part of the checks process includes making sure you can get house insurance - and that the cost of it is within your budget. Repayments have to be affordable for you and your family. Finally, when everything checks out, have your cash deposit ready. You are one step closer to calling the property home!
Step 4: Putting All Your Ducks in a Row
Now the fun part begins - going unconditional. This means that you have met all parts of your Sale and Purchase Agreement and you’ve structured your low deposit home loan in a way that works for you. You’ve also gone through all your insurance obligations and have the funds in place to pay for the property.
Step 5: Settlement Day
The day has finally arrived, and all that hard work of trying to secure a low deposit home loan has finally paid off. Settlement Day is when you get the keys to your new home and have an opportunity to carry out a pre-settlement check. This check ensures that everything is as it was when you officially bought the property. This check is a chance to voice any concerns.
Your lawyer can handle much of the work from here. They make sure the rates and utilities are up to date, then they prepare your settlement statement. The money changes hands, and either your lawyer or real estate agent will get the keys to hand to you. You can now move in and enjoy that dream home you always wanted.
Buying your first home might seem like a stressful, arduous task, but it doesn’t have to be. Many experts can make the entire experience a memorable one for all the right reasons. As long as you can secure a low deposit home loan with flexible terms, it can be smooth sailing from then on in. There’s no time like the present to talk to a non-bank lender and see what they can do for you - be it for your first home, or a second, third, or fourth.