5 questions to ask before buying a house

Buying a house is such an exciting time, that sometimes the most important pieces get glossed over, only to come crashing down later on in the purchasing process – with little you can do about them then.

We want the process of purchasing a house to be an exciting and happy one, so here are the top 5 questions you should be asking about the property you’ve got your eye on, to make sure it’s a good decision for your heart as well as your wallet.

 

Questions to ask before buying a house:

Do I need a building inspection done on the house I want to buy?

YES!

A lot of people sign contracts ‘subject to a building inspection’ which is a great way to safe guard yourself against uncovering major structural defects not visible from the outside. Although a contract signed with this condition will allow you to withdraw from purchasing the property if any major issues are found, it doesn’t safeguard you against any minor defects found.

Even though the word minor sounds ok, it could still mean you’re out of pocket thousands of dollars to fix so, we recommend getting a building inspection completed BEFORE you put in an offer. This way, you can adjust your offer according to what’s found, or you can walk away will your deposit still in your account.

 

What do I need to know if the previous owners have renovated the house themselves?

With a plethora of home renovation shows on the box these days, it appears every second person thinks they’re a bona fide tradie. If there has been work done to a property by the owner in the six years and six months pre-contract, they automatically become an owner-builder and must, by law, include a Defects Report in the Section 32 for the property. Even if they didn’t need a Building Permit to complete the works – it doesn’t mean they can sell the house carefree.

If there is no Defects Report in the Section 32, you will almost certainly be able to withdraw from the contract at any time prior to settlement.

 

Can I sign the contract without engaging a conveyancer?

Although it may seem obvious, so many people sign contracts without getting legal advice first. You wouldn’t buy a second-hand car without getting it looked over by a mechanic, so why buy a house without having the contract looked over first? Conveyancers know what they’re looking for in property contracts and can identify hidden details before you sign your hard-earned money away.

Here at the Hrkac Group, we look over your contracts for free – so it’s really a no-brainer.

 

Where should I buy an investment property?

So you’ve worked hard and saved some money and you’re looking to invest in property. Great, but looking for an investment property and looking for a house to live in yourself are completely different.

Remember, if you’re looking for an investment property, you’re not planning to live in it yourself so you can expand your horizons. Look outside the suburbs you want to live in, you don’t even have to like it – that doesn’t mean it’s a bad investment.

You’ll need to decide what sort of investment property you’re after though – do you want high rental income, or capital growth promise? Looking for a low maintenance place, or are you capable of being the on-call handyman?

 

Should I put my name on the contract?

If you own a business, it could be a smart move to leave your name off the house contract. To protect your assets, so that if you get sued at work, putting your partner’s name on the contract will remove that asset from the proceedings, keeping it protected against being taken in the legal settlement.

Although this sounds simple enough, there are always other factors to consider – like the effects this will have on your, and your partner’s tax return. Here at the Hrkac Group though, we are a full-service firm so we have an accounting team, a legal team and a mortgage broking team to cover the entire process in house.

 

So, if you’re thinking about buying a new property, you should start by calling the Hrkac Group and talk to our Legal Services team, and we can take care of things from there. Call us on 03 5224 2366 or contact us here.

First Home Loan Deposit Scheme

Purchasing your first home is a mix of making a daunting life decision and overwhelming excitement all at once. Even though you’re locking yourself in for a significant debt for the first time and you might be doubting your saving ability, there are many support systems in place to make the process of buying your first home easier.
The First Home Loan Deposit Scheme is a new initiative by the Australian Government and the National Housing Finances and Investment Corporation (NHIFC), where the Government will guarantee support for a percentage of your deposit.

Generally, you need to save a minimum of 20% of a home’s value as a deposit to avoid paying extra insurance and bank fees on your first home loan. Referred to as Lenders Mortgage Insurance, you’re basically paying the bank a fee to cover you for the amount you fall short on your deposit. With the new Deposit Scheme, the minimum deposit you’re required to pay, to avoid extra fees, is just 5%. If you can put forward 5% of your new home’s value, the Government and NHIFC will provide a guarantee to your bank for the remaining 15% (maximum).

This is not a cash payment or a deposit for your house, and there are no costs involved. What you get is support in the form of a guarantee from the Government to your bank, that you will be responsible for meeting all costs and repayments over the life of the loan. What’s even better, is this Scheme can be used in conjunction with other initiatives like the First Homeowners Grant (which exempts you from paying stamp duty on your first home).
As expected, there are rules for eligibility, which are outlined in great detail here. Some of them are:

  • It must be your first home purchase
  • You must be 18 years of age and an Australian Citizen
  • You must be either single or in a de facto/married relationship
  • You must earn under a certain amount ($125,000 for singles / combined $200,000 for couples)
  • It must be your primary residence (investment properties are not covered)
  • The property price must be under the price cap for its location (more information here).
  • It must be a principle and interest loan

If you can tick off all of these criteria, then you are eligible to apply for a place in the scheme but be quick because there are limited places available in this financial year. The Deposit Scheme is only offered in partnership with certain lenders though, so it’s best to talk to your lending specialist to reserve your position in the Scheme before they run out. There will be more places released after July 2020.

Get in touch with Paul Duncan, Geelong’s Lending Specialist to talk about securing your place in the First Home Loan Deposit Scheme today. Contact us to make an appointment, or phone 03 5224 2366.

Information is intended to be of a general nature only and any advice has been prepared without taking into account any person’s particular objectives, financial situation or needs</em

Today’s Home Loan market is a complex proposition for potential borrowers, from First Home Buyers through to experienced property investors. Engaging a Mortgage Broker to assist you can make all the difference in being able to find a suitable loan from a maze of lenders, with complex lending rules and regulations currently in place. A mortgage broker can do all of the leg work for you, including checking your borrowing capacity and ensuring you meet the lending criteria, of dozens of lenders, and you choose who you want to deal with.

It is important to note that a Mortgage Broker is required to work in your best interests by law, and consumers have legal protection if a Broker doesn’t do so. Hrkac Group Mortgage Broker’s don’t charge any fees to our clients. If we do our job properly, and locate a suitable loan for our clients, the Lenders will pay a commission to us. The commission isn’t added to your loan amount or interest rate, so it is a completely free, ethical and professional service we provide.

Why use HRKAC’s Mortgage Brokers:

1) We’re thorough

We discuss and analyse your existing situation, your home loan needs and requirements, and obtain all necessary information pertaining to your home loan application.

2) We make it simple

We explain the types of home loans available to you from a range of banks and specialist finance companies. Such as:

  • Home Loans
  • Investment Home Loans
  • Vehicle & Equipment Loans
  • Small Business Loan
  • Refinances
  • Debt Consolidations

3) Specialised & personalised service

Based on the information provided by you, and utilising specialist home loan software, we match your home loan requirements to a selection of home loan products offered by our panel of lenders.

4) Overview of costs

We provide an overview of your ‘Purchase Budget’ incorporating the relevant costs associated with your home loan application in writing.

5) In-Depth view of products

We provide an in-depth overview of the home loan product or products you select, in writing.

6) We do the tricky parts

We complete and package your home loan application and deliver it to the lender’s assessment team on your behalf.

7) We dot the i’s and cross the t’s

We act as an intermediary between you and the lender, negotiating the terms and conditions of your loan. We will also answer any questions the lender’s assessment team may have, on your behalf.

8) Communicate with all parties

We liaise with your solicitor, real estate agent and accountant, and any other related parties to ensure a smooth and timely settlement.

9) Going the extra step

We assist with any future home loan requirements, whether you wish to check, change, or top-up your loan, or renegotiate your current home loan interest rate with your existing lender.

10) Keeping you updated

We act as a valuable information service beyond the settlement of your loan by providing you with relevant information on the home loan market, updates on products, and special offers that may be of interest to you.