Home Buying

First Home Buyers: Your Complete Guide to Buying your First Home

Buying your first home is one of life’s biggest milestones, but if you’re just starting out, it can feel confusing and overwhelming. With so much information, it’s hard to know where to begin.

At Smart Lending, we help first home buyers cut through the noise and navigate the process with ease. From calculating how much you can borrow to settlement day, here’s everything you need to know about purchasing your first home.

Step 1: Speak with a Mortgage Broker (aka Smart Lending)

The first step in your journey should be speaking with a mortgage broker. At Smart Lending, we’ll complete a borrowing capacity assessment, looking at:

Your income from employment
Your living expenses
Exisiting debts such as credit cards, car loans, personal loans or buy now pay later platforms like Afterpay or ZipPay

This gives you a clear picture of how much you can borrow and sets the foundation for your property search.

Step 2: Save Your Deposit

In most cases, you’ll need at least 5% deposit of the property’s purchase price. Lenders also want to see ‘genuine savings’ built up over three months or more.

Your savings target will depend on factor like property price, lender requirements, and whether you qualify for government schemes.

Step 3: Explore First Home Buyer Schemes

The government offers several programs to help first home buyers get into the market sooner, including:

First Home Guarantee Scheme: Buy with a smaller deposit without paying lenders mortgage insurance (LMI).
First Home Owner Grant: A one-off payment towards your purchase if you’re building or buying a new home
Stamp Duty Concessions: Reduced or waived stamp duty, depending on your state or territory.

Your broker can help you understand which schemes you’re eligible for and how they can fast track your purchase.

Step 4: Get Pre-Approved

Before you start house hunting, it’s a good idea to secure a loan pre-approval. This involved submitting an application to you chosen lender, who reviews your financials and confirms how much they’re willing to lend you.

With a pre-approval, you’ll know:

Your borrowing capacity
The interest rate you qualify for
An estimate on your monthly repayments

This gives you confidence when searching for a property and allows you to make offers with certainty.

Step 5: Find Your Home and Make an Offer

Once you’ve found a home within your budget, it’s time to make an offer. At this stage:

You’ll sign a Contract of Sale outlining the purchase price, settlement date and conditions (such as subject to finance).
Your broker will arrange a bank valuation to confirm the property is suitable security for your loan
Your loan application will move to formal approval, meaning the lender is ready to fund your purchase.

Step 6: Review and Sign your Loan Documents

Once your loan is approved, the bank issues documents for you to sign. Your broker will go through these with you, explaining:

Loan structure and repayment details
Features like redraw or offset accounts
The next steps leading up to settlement

This ensures you fully understand your new loan and feel confident moving forward.

Step 7: Settlement Day – Collect Your Keys!

Settlement is the final step in becoming a homeowner. On the day, your broker, lender and conveyancer work together to:

Transfer the property funds
Register the title in your name
Finalise all legal requirements

All you need to do is make sure your contribution funds are ready, then celebrate moving into your new home!

Ready to Buy your First Home?

At Smart Lending, we make the first home buyer journey simple, stress free and tailored to your individual needs. From your very first appointment through to settlement day, we’re here to guide you every step the way.