Buying your first home is exciting — but it can also feel overwhelming. Many Australians turn to a mortgage broker to make sense of the process, find the right home loan, and make sure they can comfortably afford repayments.
Here are the five most common questions first home buyers ask mortgage brokers in Australia, and what you need to know before applying for a home loan.
1. How Much Can I Borrow?
Your borrowing power isn’t based on salary alone.
Lenders consider:
- Income and living expenses
- Existing debts, including credit cards or personal loans
- Dependants and other financial commitments
A mortgage broker can help you understand your realistic borrowing capacity and compare lenders. Getting pre-approval early helps clarify your budget before you start house-hunting.
2. How Much Deposit Do I Need?
Many people assume a 20% deposit is mandatory. While common, some loans allow deposits as low as 5%, particularly with government schemes like the First Home Guarantee.
A broker can explain:
- Whether Lenders Mortgage Insurance (LMI) applies
- Which government schemes you qualify for
- How your deposit affects loan size and repayments
3. What Will My Repayments Be?
Your monthly mortgage repayments depend on:
- Loan amount and term
- Interest rate type (fixed vs variable)
- Additional ongoing costs, such as utilities, body corporate fees, and living expenses
A broker can provide repayment simulations to help you see how your mortgage fits into your overall budget.
4. Should I Fix My Rate or Go Variable?
Choosing between a fixed or variable rate is about understanding loan structure:
- Fixed rates provide predictable repayments for a set period
- Variable rates allow flexibility, including extra repayments or adjusting your loan if circumstances change
A mortgage broker can help you compare the pros and cons and choose a loan structure that works with your budget.
5. What Costs Do I Need to Budget For Upfront?
Beyond the deposit, other costs include:
- Stamp duty (state-based; sometimes waived for first home buyers)
- Lenders Mortgage Insurance if your deposit is below 20%
- Legal or conveyancing fees
- Bank or application fees
Knowing these costs early helps ensure your loan is structured to suit your budget.
Why Use a Mortgage Broker in Australia?
A trusted mortgage broker can help first home buyers:
- Understand borrowing capacity and loan options
- Navigate government schemes and low-deposit loans
- Structure repayments that fit your lifestyle
- Save time comparing dozens of lenders
If you’re looking for reliable mortgage brokers in Australia, 20/20 Finance Brokers can provide expert guidance and help you find a home loan that suits your situation.
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