What is the First Home Loan Deposit Scheme
Are you a first-time homebuyer and need some assistance getting into the property market? Don’t worry. There is help available with the First Home Loan...Read More
Be prepared by finding out the other costs separate to your home deposit.
All first-time buyers and investors may underestimate how much they really need to save to buy a property. There are other costs that buyers need to be aware of and not just the deposit for the property which typically forms the most significant cost associated with purchasing a property.
From government charges to lender fees, there are secondary costs associated with buying a house and taking these costs into account will give you a clearer picture of what you need to save when buying a property.
Our property buying calculator is quite detailed but you are not required to complete all the fields as it depends on the type of property you are buying so your best guesstimate is ok.
Below is an example of buying a $500,000 investment house in NSW. Please note that this is an estimate only.
Government charges (Mandatory)
Other buying costs
Total property buying cost estimate = $21,929
Total deposit required if you are borrowing 80% of the purchase price is:
Deposit: 20% x $500,000: $100,000
Total property buying cost: $21,929
Total savings required: $100,000 + $21,929: $129,929
All the above cost is in addition to the deposit you have saved up for your property purchase.
Let’s use the above example to demonstrate this.
You have saved 20% deposit ($100,000) to purchase an established investment property.
Your total cost: $21,929
Amount available for deposit: ($100,000 – $21,929): $78,071
This means you no longer have 20% deposit after accounting for the cost and you will need to borrow more to make up the difference.
In this example, you will need to increase your loan amount from $400,000 to 421,929 which is 84% of the purchase price. Please note, borrowing more than 80% of the purchase price will trigger lenders mortgage insurance which is paid by the buyer.
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Any calculations or estimated savings do not constitute an offer of credit or a credit quote and are only an estimate of what you may be able to achieve based on the accuracy of the information provided. It doesn’t take into account any product features or any applicable fees.
*2.89% Interest rate based on an Owners Occupied, Principal and Interest, 3 years fixed period, minimum loan size of $250,000, maximum LVR of 80%, over a 30 year term. Eligibility subject to servicing requirements, contact one of our specialised mortgage brokers for more information.
^3.77% Comparison rate based on a loan of $250,000 over a 30 year term. WARNING: The comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Costs such as redraw fees or early repayment fees and cost savings such as fee waivers are not included in the comparison rate but may influence the cost of the loan.