20 August 2019
Needing some tips on how to save for a deposit?
Are you saving up to buy your first home? If you’re like any other first-time home buyers, you’ve been saving for that home loan deposit for ages. There is so much to learn and understand around buying your first home, but for most of us, the biggest hurdle is saving enough for the deposit. Here are a few tips to help you pull together the deposit you need and purchase your very first home.
How much deposit will I need to save?
A deposit will be anywhere from 5% of the total price of the home through to 20% depending on the loan, the bank and the property. A larger deposit may mean a lower interest rate, so in the long-run its best to save as much as you can.
How to save for your deposit
The first step towards saving for your deposit is to create a budget that you can live with. Preparing a budget is not as complicated as it sounds. The best place to start is to record all of your income as well as all of your spending. If you’re like most people, you’ll notice that you spend money on items you could easily cut back on. Break these spending’s down into categories. For example:
- Rent and utilities
- Phone and internet
You’ll need to sit down and work out how much you realistically need to spend on each. Most of us are unaware of exactly how much we spend on take away or that morning coffee on the way to work. Just by using the coffee machine at home or work instead of the morning trip for a latte can save you over $1,000 a year!
Your credit rating
When you’re applying for a loan, your credit rating is very important. If you have a bad score, you should spend some time repairing it. If your score is on the lower side, you’re less likely to convince a lender to loan you the money. Here are a few ideas to get you started on improving your credit score:
- Putting your payments on auto pay or setting up auto reminders so you don’t forget
- Work on paying off any debts faster than the suggested minimum payments
- Contact your creditors or a credit counselling service for assistance
First Home Owners Grant
The Queensland First Home Owners’ Grant is a state government initiative to help first home owners to get their new first home sooner. First Home Buyers get $15,000 towards buying or building a new home, from July 1st 2018. To find out more about the First Home Owners Grant Download a copy of our guide here.
Are you ready to start saving for your new home?
Create a budget, request your credit report, and call your mortgage broker! View our huge range of projects here!