As we embrace 2022, we are pleased to have met an influx of new buyers to the market. Many are planning to make 2022 the year they purchase their first home or add another one to their investment portfolio. At Lucas, we are here to help and here are my top Do's and Don'ts when buying a property with finance.

Do's

Have your pre-approval ready

Not only will having pre-approval ready give you an idea of how much you can borrow but it will also give you great confidence when submitting an offer. After all the effort you've put into finding your dream home, this will put you in the best position to secure it. Make sure to speak to a recommended broker that offers a wide range of products and services that best suit you and your financial circumstances. In addition, a full assessment pre-approval may take longer to be approved but it would give you the most accurate estimate of your borrowing capacity versus an online pre-approval.

Research of market value

Ask your agent for comparable sales in the recent months to understand the most relevant market indication. Some online platforms do offer an estimated value, but it may not take into consideration the difference in property condition, upgrades, car park or storage cages that may or may not have been included. Speak with your agent for the most comprehensive comparable sales.

Keep your accounts clean

Always make your existing mortgage repayment or rent payment on time and in full. Keep all accounts current. Pay your bills and commitments on time, including car loans, student loans, credit cards, utilities, and phone services.

Don'ts

Don't max out your credit cards

Lenders aren't particularly big fans of credit card debt, in some cases, just the number of credit cards you own may have an impact on your borrowing capacity. Alongside any late payments/dishonour fees, these are all red flags in creditors' assessments.

Don't underestimate the suitable security

One of the lender's assessments is to determine if the property you are purchasing is suitable security. Namely, if the property meets the minimum size requirement, postcode, or any concerns of cladding materials have been rectified. Communicate with your broker often and do due diligence.

Don't change your employment

If it is unavoidable, make sure you talk to your lender. Employment changes where your income will decrease, become commission-based or is in a different field may cause a red flag.