Am I in a Position to Buy?

[azzae89]

I'm guessing you haven't been at your current job very long? (3 years+).. That will account for the low savings. However lenders ask how long you have been with your current employer and might be reluctant to lend to you if you are still a relative newbie to the firm.

About 2 years actually. However I was only put on 85K around mid-year. Previously on around 55K which made it hard to save whilst paying off car and CC debt. My work history is very solid, with rarely any prolonged periods of unemployment since leaving uni so hopefully that works in my favour.

Thanks!

 

[nhg]

About 2 years actually. However I was only put on 85K around mid-year. Previously on around 55K which made it hard to save whilst paying off car and CC debt. My work history is very solid, with rarely any prolonged periods of unemployment since leaving uni so hopefully that works in my favour.

Thanks!

Hey,

Great to hear your getting started, I was 23 when I caught the itch and haven't looked back. I'm curious, your savings, have you run your budget or is this based on top-of-your-head calcs?

I have also been on 85k and above since I was 23 and I don't see how you projected your savings. Judging from the CC debt, car and where you live, I would imagine your expenses are higher than you are tracking.

Just something to be wary about. As mentioned previously, you may want to track your daily costs for a couple of months to see where the leaks are. I did the same using a budget app on my phone and was shocked with what I tracked.

 

[rowena]

Hi Azze, Welcome to SS.

Im going to throw a different idea out to you, which im surprised noone has mentioned, and its because everyone is looking at this as a IP only point of view!!!.

Why not buy a property and move into it for the first 6 months.. or 12 months if required to by NSW in order to get your FHOG.

This will mean you will save quiet a bit of money in stamp duty. Put all your extra money into the offset account, and do not pay off the homeloan. After the FHOG period is up move back into your parents.

You then have 6 years before you need to move back into this property. You have already stated you are going to move into this property later down the track anyhow. If you move into the property first and get your FHOG, you also avoid paying capital gains tax if you decide to sell, as long as you move back into your property within in this 6 year period, or do not buy another principle place of residence (PPOR). Once you buy another PPOR then you have to pay CGT on the first property from that point of time onwards. You can however buy other IPs, but obviously CGT will apply to them.


**This is the part im not sure on so others can correct me. **If you buy a IP first, and then a PPOR i do not beleive you can get the FHOG on the PPOR as this is classifed your 2nd property. As FHOG is for First home purchased and if you purchased as a IP then you dont qualify.


** this advice here speak to a mortgage broker for their point of view**
the other thing to consider too is that paying off your credit card first then car loan debt early is possibly a good thing. Remember your paying the car loan at a much higher interest rate then what a home loan would be. If you nail it on the head you can also show that you can meet home loan repayments no issue and not have that debt affecting your servicability. However First thing i would do is speak to a mortgage broker and see what they think. Either way I would be looking at a very min of 20K saved to cover your deposit, lawyer, duties, and so on. More around 25k would be my thinking.


When i bought my properties i had no car loan and my CC i paid off monthly. I only use CC for necessitaries and to get a credit rating!.

 

[Shahin_Afarin]

You only get the FHOG on new dwellings which in Sydney is a high entry point (and thats not even getting into OTP purchases).

Regards

Shahin

 

[rowena]

You only get the FHOG on new dwellings which in Sydney is a high entry point (and thats not even getting into OTP purchases).

Regards

Shahin

Gov loves changing the rules. thanks shahin.

 

[tambourineman]

95% + LMI is not easy...but as long as you tick the boxes, it be fine...

- Solid employment ( over 2 years same company, preferred)
- Solid working history
- Strong serviceability
- Low consumers debt ( especially credit cards)
- No unsecured personal loans outstanding (preferred )
- Haven't missed any payments
- Saving account in good working order/history ( no overdraw)
- Low activity on credit file for the last 12-18 month
- Clean credit
- Low movement in terms of residence ( ie stable residential history)
- Good security.
- Genuine savings preferred, but some lenders can over look this.

I have never quite understood why lenders are so concerned about moving house often - the line of work I am in means we generally have moved every two years or less (even with the same company) and most rental leases are for 12 months. I realis they all do it but i really dont understand why - what dfference does it make?

 

[tambourineman]

You only get the FHOG on new dwellings which in Sydney is a high entry point (and thats not even getting into OTP purchases).

Regards

Shahin

best policy decision since it began, it should have been that way from the beginning.

 

[MikeR]

- If you can get $21000 for the Jeep, sell it, you can buy something mechanically sound for 10k.

+1

I'm surprised more posters didn't have it as STEP 1 in their advice to the OP. Adds the $9k he was going to pay in car repayments by June to his savings pool.

 

[Shahin_Afarin]

Gov loves changing the rules. thanks shahin.

Bazza has made a lot of changes!

Regards

Shahin

 

[Shahin_Afarin]

best policy decision since it began, it should have been that way from the beginning.

I think other states will follow down this path in the not so distant future.

Regards

Shahin

 

[tobe]

I think other states will follow down this path in the not so distant future.

Regards

Shahin

Like victoria?? not. In case you hadnt noticed, victoria had been encouranging FHB to build for the past 3 years, and only recently pulled it (with the change of government). I agree the government gets a bigger bang for its FHB buck by incentivising FHB to build, but I doubt it will last long in NSW and QLD, (and now Tas) or that other states will follow.

It only brings forward demand, it doesnt create demand. the FHB's that dont like the idea of a new apartment, or living in the boonies dont move to the boonies to get the grant, they buy established in the city.