Buying your first home comes with a million questions like how much deposit do I need?, how much can I borrow?, will my spending or debts affect my home loan?, and do I really need a mortgage broker? Add government schemes like the First Home Guarantee Scheme (FHGS), First Home Owner Grant (FHOG), Family Home Guarantee (FHG), interest rates, and confusing online advice into the mix, and it’s easy to feel overwhelmed before you’ve even started. You may even be wondering what questions should I ask my mortgage broker? This guide answers the most common first home buyer questions, breaking down deposits, borrowing power, spending, timelines, and support options in plain English – so you can move forward with clarity and confidence.
1. Will a mortgage broker judge my spending?
A broker will never judge your spending, in fact, we’ll be the first to admit the convenience of Uber Eats…
We will, however, help you understand how a bank sees spending on things like Buy Now Pay Later, subscriptions, gambling etc.
2. How long does the home loan application process take?
How long a home loan application will take will vary depending on your individual circumstances, however, a good mortgage broker will always keep you in the loop, provide regular updates, and get it done as fast as possible.
3. Is it true that I only need a 5% deposit / How does the First Home Guarantee Scheme work?
If you’re using the First Home Guarantee Scheme, you are able to contribute a minimum of 5% deposit, and the government will guarantee the rest to make up a standard 20% deposit.
It doesn’t mean that you can then take a loan out of 80% of the property value, you will still need to make up the difference of what you’ve contributed yourself (eg. if you provide a 5% deposit, you’ll need a loan of 95%).
Read more about the scheme here.
4. What is the smallest deposit I need to buy a house?
Technically, there is a way to buy a house with no deposit. If your parents are willing to guarantee your deposit using the equity in their home, this is possible.
However, aside from this strategy, single parents require a minimum of 2% through the Family Home Guarantee, and first home buyers can use a minimum of 5%. Your eligibility for this scheme depends on a range of factors, which a mortgage broker can help you navigate.
5. Am I ready to buy a house?
A lot of the time, clients actually have the funds to buy their first home, but need help running the numbers to realise it. If you’re thinking about taking the first step to see a mortgage broker, chances are you’re more ready than you think!
6. Can my parents help me buy a house?
There are certainly ways for parents to help you purchase a property. They don’t always need to contribute a cash deposit. Sometimes, they can use the equity in their home to guarantee part of the deposit on your home. A mortgage broker can help you decide if this is an option worth considering, or if there are more suitable options.
7. Will a mortgage broker get me the best interest rate?
Short answer – Yes.
Long answer – If it is better for you to go with a lender that doesn’t have the best rate, but the loan setup is better for your personal situation, we will always recommend what is in your best interests – it’s the law!
8. Do I need to clear my debts before buying a house?
Credit cards, car loans and HECS/HELP loans are very common for people to have when applying for a home loan. It depends on your situation, and how much your debt impacts your borrowing capacity, which we can help you understand. It is generally a good idea to speak to a mortgage broker before paying any large debts.
9. Do I need to find a property before seeing a mortgage broker?
You don’t need to have found a property before seeing a mortgage broker – in fact, it makes more sense not to, as a broker can tell you your borrowing capacity, so you can shop with a budget in mind!
10. What’s the first step to buying a house?
If you’re asking us this question, chances are you’ve already made it! The rest is easy, as a mortgage broker can guide you through the rest of the process, every step of the way.
