Home Loans

[SCRIBR]

I like how people say "you must have 20%"

who can save $60,000+ for a deposit?

By the time you have spent your 2 years (at best) saving 60k, house prices have gone up by (on 350k house) at least 25k. So that's your second year of saving down the poo tube.

[AceofSpades]

scribr,

I dont have a house and that is one of the main reasons.

I should have said that more loosley. that's the ideal minimum aim, because this course puts you in a better position for the future. I have a firm belieif that property prices are so over exagerated at the moment, im not buying.. I think there is major pain in the future for people that have borrowed large amounts and are near their limit.

when the time comes for me to buy, I will not enter the market with less than 10% + costs. That will only be if I stumble across the right property at the right price. otherwise I will hold my aim for 20% +.

If the only goal is to own a house, then much of what I said seem too painful and hard to achieve when it can be done with less up front cash.

I look at things to try to provide as much financial freedoms as possible. therefore reducing costs to the minimum necessary is a priority.

[XR06T]

I will recommend seeing a broker..

mine helped us alot with the purchase of the house and consolidation of our loans.

you should be ok to service the 300k loan on combined 100k/year as a 300k loan will cost you around 550$/week and you'd be taking home $1400+

I would probably try and keep the personal loan separate as you should be able to service both. We got our 260k loan approved with me having a 26k car loan and the missus having a 9k car loan and 2k on a credit card.

best of luck mate!

[XR06T]

also agree with scribbr, I got in as soon as it was possible and reaped the rewards, so im a firm beliver in NOT saving 60k over 2 years before diving in. (my opinion only, not financial advice!)

think of the equity you build in a house over those 2 years!

[SCRIBR]

I have spoken to a couple of people about the "over-inflation" of houses. One guy, who has quite a few properties, told me that it is true that the prices are over inflated. But when prices hold steady or drop this will only affect high end & middle range houses. Lower range houses (< $320k) won't be affected, as the demand for these houses will still be there.

Seems to make sence to me.

[Azid Rush]

thanks for the ideas guys, lot of different opinions going around.

Personally, Im going to leave the personal loan the way it is, as I dont want a 25k car turning into a 55k car by the end of the 30yr home loan lol

But personally, I wont be 1 of the ppl saving up 60k for 20% deposit as ive spoken to a few home loan lenders such as wizard, and the penalties for borrowing 100% or even 90% of the purchase price isnt all that great.

The difference between borrowing 90% of purchase price and 100% of purchase price, basically came down to the fact u can only borrow about 10k less then what u could if u had a deposit. And considering I can borrow more then what I want, that isnt going to affect me to much anyhoo

[Guest FatBAt]

thanks for the ideas guys, lot of different opinions going around.

Personally, Im going to leave the personal loan the way it is, as I dont want a 25k car turning into a 55k car by the end of the 30yr home loan lol

The weekly difference of borrowing $300000 ($507p/w) to $325000 ($549p/w) is about $42 at 8% over a 30 year term. Ask yourself. What is the difference of what you're paying off your personal loan now, compared to $42.

If it is say $85 per week, pay THAT difference plus your $549 off your housing loan by paying $634. By doing it this way, you get the benefit of paying more off your entire loan AND you have a little bit more control when interest rates do go up just by asking the bank to reduce your loan back down to the minimum of $549. When things get better, increase it again.

By keeping your loan repayments as low as you can get it, and paying off the maximum you can afford is the safest option because YOU have control over your payments, not the lender.

Just another way of looking at the benefits of incorporating the 2 loans.

Cheers

Steve

PS

At this time, we are in a VERY unpredictable money market and it is predicted to get worse. Economists expect rates to rise to 9.5%. Employment is down which means we spend more money which means interest rates will rise. Without bringing in overseas influences, that is (in the simplest way) how our economy works.

Cheers

[Dillz]

I like how people say "you must have 20%"

who can save $60,000+ for a deposit?

By the time you have spent your 2 years (at best) saving 60k, house prices have gone up by (on 350k house) at least 25k. So that's your second year of saving down the poo tube.

that's crap Mate, you can buy a house with no deposit but it is by far the hardest way to do it. The biggest problem with it is convincing the bank you can afford it and convincing the owner you can afford it.

If someone comes in to me and says I'd like to buy this house for 350k I'd say ok, do you have access to a 10% deposit? No. Alright how about a 5% deposit? No. Can you put a 1000 dollar holding deposit down today? No. By this stage you know somethings up, if someone wants to buy a 350k house and doesn't even have $1000 dollars on them it's very unlikely they will get finance. Oh and pre approval ain't worth the paper it's written on.

[80 RPM]

thanks for the ideas guys, lot of different opinions going around.

Personally, Im going to leave the personal loan the way it is, as I dont want a 25k car turning into a 55k car by the end of the 30yr home loan lol

But personally, I wont be 1 of the ppl saving up 60k for 20% deposit as ive spoken to a few home loan lenders such as wizard, and the penalties for borrowing 100% or even 90% of the purchase price isnt all that great.

The difference between borrowing 90% of purchase price and 100% of purchase price, basically came down to the fact u can only borrow about 10k less then what u could if u had a deposit. And considering I can borrow more then what I want, that isnt going to affect me to much anyhoo

I'd add my situation but its slightly different to yours

We bought a house in april , we had approval for alot more but it was at the upper end of the scale

we found a house (that needed some work) for a less price so we were nowhere near our servicable limit

since we got the house we have renovated quite a bit probably spent 5g on credit card and we had about 10k saved for deposit which we used for the reno's instead because we were buying a cheaper house.

we had 15k saved

three cars total value 50k all owned

one boat owned value 5k

credit card debts about 3k

and got the loan no probs with suncorp through Aussie.

I would recomend them as the aussie lady really does her homework and helps you out with all the questions you may have .

our situation now

we are still a three car family however in Nov I got a loan for the XR and we conslidated the left over credit car debt + some credit card debt from some renos onto another loan

we delt with the bank directly but the first option wasn't the one we went with, our home value had gone up and the bank offered to tack car onto house and offer a personal loan for the debt

we said no because as mentioned and you agree you don't want to be paying your car off in ten years time and 9% for 5 years is alot less than what it would be over 29 years.

what we ended up doing was a low intrest car loan (had to be +02 or newer from a dealer) for 25k

and consolidated debt personal loan

Our current plan is paying the debt loan out the quickest 5 year loan but we plan to pay off within 18 months, once this is out of the way the money will then go ontop of payments for the ute to knock that one out.

hopefully by this time all the reno's will be done and we'll be looking at a new SUV for the Mrs before kid number 1!

defanatly go and see a broker and see what they can do for you, you might be suprised

[Dillz]

Have a look see

It's very rough but you can clearly see the 37k difference when you whack 20k onto your home loan.

Edited 18/01/08 12:54 AM by XRTPSI