Advice for First Home Buyers
There are so many things to think about: the neighbourhood, the people, schools, shops, public transport, convenience, and even the view from your balcony. But before you start thinking about all of that, there is one thing you should consider first:
Your home loan. Have you searched for one yet?
Open your browser and search for “home loan.”
What do you see?
On the first page, you will probably find names like Macquarie Bank, ANZ, CommBank, NAB, Canstar and Qudos Bank. Most of the results are banks.
Go to the second page. You may see Macquarie Bank, St.George, Bank of Sydney, Bank Australia, BankSA, Pepper Money, ING, Westpac and ME Bank.
Again, most of the results are banks or well-known financial institutions.
Does that mean banks are your only option?
But even then, **is the loan they offer you necessarily the best loan available?** Probably not something you should assume.
Why?
Because you have compared one lender with, at most, a handful of others. You haven’t compared the hundreds of lenders and loan products available in the Australian market.
And this is where a **mortgage brokers** can make a real difference — particularly for a first home buyer.
What if your situation isn't straightforward?
Maybe you don’t have a large deposit.
Maybe you’re self-employed.
Maybe your income isn’t easy to document.
Maybe you have a less-than-perfect credit history.
Maybe your borrowing capacity is lower than you expected.
In these situations, speaking to a bank may not be enough.
Australia has a large and diverse lending market, including banks, non-bank lenders and specialist lenders. Many of these lenders don’t appear prominently when you simply search for “home loan” on Google.
So how do you find them?
Search for terms such as *mortgage brokers, home loan broker, mortgage adviser* or *finance broker*, and you will find all brokers operating in your local area. Some have offices, while others work entirely online or from home.
A good Mortgage broker can have access to a wide range of lenders that you may never have considered. More importantly, they can look at **your individual circumstances** and identify lenders whose lending policies may suit you.
And in many cases, their service to you is provided at no direct cost, because the lender pays the Mortgage broker a commission. Always ask your broker how they are paid and what fees, if any, you will be charged.
One lender may be uncomfortable with your income structure, while another may have a policy that works better for your circumstances.
For example, if you are self-employed and much of your income is difficult to demonstrate through traditional payslips, a mainstream lender may have trouble assessing your application.
But some specialist lenders assess self-employed income differently. That doesn’t mean you will automatically qualify. It simply means **one lender’s answer isn’t necessarily the answer from every lender.**
As my mentor Margaret Fraser once put it, you might feel like *“a dead duck”* when a bank says no. But there may still be a lender willing to say yes.
My advice to first home buyers
Don’t start your home-buying journey by asking:
**“Which bank should I go to?”**
Start by asking:
**“Which home loan is right for me?”**
Those are two very different questions.
Your first home is more than a property. It is a major financial commitment that can affect your finances for decades.
And, especially if your financial situation isn’t straightforward, consider speaking to a **local mortgage broker** who understands the lending market and can explain your options.
A good broker may save you more than just money. They may save you time, frustration and, potentially, a very expensive mistake
And when you finally receive the keys to your first home, there is nothing quite like the feeling of knowing:
**“This is my home.”**
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