Browse Forums Home Finance 1 Aug 27, 2014 12:38 pm hey guys I am a first home buyer I have a pre-approval with NAB as my lender and I will be borrowing 300k and monthly repayments will be 1624 per month Looking to buy a house for 330k purchase price I have 87k for savings and will be using 44k out of that as my deposit I earn 50k per year and I will be doing this on my own Will I be able to afford living in the house and pay the bills and buy food etc? Will worried about this Re: Can i afford to live in my home 2Aug 27, 2014 12:53 pm Is 50k your net or taxable income? Even if its net you'll be spending at 50% of your income on the house once you add you insurance, land rates, water etc. It seems very tight to me but you seem to be a good saver, how do you feel about it? Also did you get the loan saying you'd rent out the place and $44k deposit still means you'll be paying LMI? Given you have the 20% is this a decision you made or has the bank or broker suggested it? http://camdenbuild.blogspot.com.au/ by invite only please pm me Re: Can i afford to live in my home 3Aug 27, 2014 1:36 pm Just confirmed with my broker and she told me this: As you have around $40000 in your savings and you need $66000 deposit on the purchase price of $330000, you have no choice but to get Lenders Mortgage insurance as you were borrowing 90% of the purchase price I told her I did not want to use all my deposit only about half as I want to invest into shares and maybe another property later on At the moment I am netting 1600 per fortnight and saving 1000 per fortnight and have been doing this for a very long time. So you could say I am already living with a mortgage but I do live at home with my mum still and dont pay rent Re: Can i afford to live in my home 4Aug 27, 2014 2:05 pm On $300K, repayments will be approx $1600/month (less if you go IO), that is less than the $2K you are currently saving. However you then have to include outgoings you aren't currently paying such as bills, etc. The other option is to buy it as an investment property, and hold it while still living at home until things improve with your personal income. Cheers Tom Re: Can i afford to live in my home 6Aug 27, 2014 3:26 pm You really need to put all your money into this property as a deposit and avoid LMI. Things come up so you really need to have back up plans. Have you thought about renting a room. This extra 100 per week or so can easily go to paying all your bills. Also are you currently living somewhere rent free or are you paying rent. If you going from paying rent to owning a house it will be much different that going from free rent to mortgage. Re: Can i afford to live in my home 7Aug 27, 2014 3:41 pm Its hard to say without knowing all your circumstances... What are all your weekly/monthly expenses currently? What will change when you are on your own? Food, water, elec, phone, insurances...etc You need to sit down and write out every expense you can think of. And put some money towards it, either what you currently pay or what you think you might pay. For gas/elec/water I would put aside $50 for each one every month. Food - I have no idea how much 1 person would spend - $100 every 2 weeks? Rates? That depends on your area I agree - if you've got enough saved use it to cover your deposit so that you don't need to pay mortgage insurance - that is just throwing money away. My build: viewtopic.php?f=31&t=68002 Re: Can i afford to live in my home 9Aug 27, 2014 4:23 pm Mortgage insurance is a one time fee but its generally lumped onto your financed amount so you pay interest on it. Plus if you want to refinance with another lender later and are still borrowing more than 80% you will pay it again so effectively you are locked into this loan until such a time as your equity is more than 20%. http://camdenbuild.blogspot.com.au/ by invite only please pm me Re: Can i afford to live in my home 10Aug 27, 2014 4:35 pm robbie55 Mortgage insurance is a one time fee but its generally lumped onto your financed amount so you pay interest on it. Plus if you want to refinance with another lender later and are still borrowing more than 80% you will pay it again so effectively you are locked into this loan until such a time as your equity is more than 20%. Thanks for that, didnt know you had to pay it again if I change This is what my broker got back to me with: To avoid mortgage insurance you need to put in 20% of the purchase price and you will also need to find the money to pay for the stamp duty and legal costs which is $10104. You will need to have a total amount of $76104 . for the $330000 purchase. With you only putting in $43104 your mortgage insurance premium was $4106 which is a one off payment. Which means I wont have much money to invest into some shares and do things for the house like i wanted to I was planning to make this property a investment in a couple of years though Re: Can i afford to live in my home 11Aug 27, 2014 5:00 pm The LMI is less than I thought actually and you have some plans for the other money so not a bad option. Not trying to sway you one way or the other but: 10% deposit means you will be paying around $1600/month in P&I repayments 20% deposit means you will be paying around $1420/month in P&I repayments Have you spoken to an accountant about your plans to make it an investment in a few years - structure of your loan to say interest only in that first couple of years might be an option and will certainly reduce your minimum replayments. Also facilities like an offset where you could still deposit that extra money would lessen the interest you have to pay out of your own pocket now and probably important to have once it does become your investment property. It might seem a bit early to start getting this advice but getting it right from the start can save you heaps. http://camdenbuild.blogspot.com.au/ by invite only please pm me Re: Can i afford to live in my home 12Aug 27, 2014 11:22 pm Drekko robbie55 Mortgage insurance is a one time fee but its generally lumped onto your financed amount so you pay interest on it. Plus if you want to refinance with another lender later and are still borrowing more than 80% you will pay it again so effectively you are locked into this loan until such a time as your equity is more than 20%. Thanks for that, didnt know you had to pay it again if I change This is what my broker got back to me with: To avoid mortgage insurance you need to put in 20% of the purchase price and you will also need to find the money to pay for the stamp duty and legal costs which is $10104. You will need to have a total amount of $76104 . for the $330000 purchase. With you only putting in $43104 your mortgage insurance premium was $4106 which is a one off payment. Which means I wont have much money to invest into some shares and do things for the house like i wanted to I was planning to make this property a investment in a couple of years though In that case if you are making it into an investment in a few years, you should definitely be looking at interest only + offset account. Your broker should have suggested this to you. That would make your repayments currently approx. $1250 per month and that figure would decrease as you save more and more into you offset. Also are you building? If you are as a first home buyer you should be entitled to the FHOG which can be used towards the deposit. Cheers Tom Re: Can i afford to live in my home 14Aug 29, 2014 11:45 pm You could always rent a room out for extra income and to split bills Recently moved to a 60's home in need of some improvement! http://s797.photobucket.com/user/leenii ... ch%20House Old house: http://s797.photobucket.com/albums/yy25 ... loo/House/ Re: Can i afford to live in my home 15Aug 30, 2014 8:35 am I think the bills wouldn't cost you much if you were by yourself, as long as you weren't silly leaving everything on in the house (lights, tv, heater) when you weren't home! I was renting by myself for 3 years and my water, gas and electricity was no more than 500 a quarter. I'm not too sure about rates? But you seem to be good with your money, you'll also get the first home buyers (pretty sure it's still going, we just received ours) so that will reduce your stamp duty and you'll possibly get the lump sum payment if you're building. We dodged our Morgage insurance, it's just a waste of money if you've already got the money there! Good luck Re: Can i afford to live in my home 17Aug 30, 2014 1:49 pm If you are planning on the property bring an investment property down the track then borrow the 90% and the LMI. Down the track when you rent it out you will be able to claim the interest on the extra 10% and LMI. Set the loan up as interest only with an offset account which will help with negative gearing once you rent it out. Your minimum repayment will be lower with interest only but still put in as much as you can afford each month into the offset account. If you decide to buy anything like a car or shares or another investment property down the track you can move the money freely out of the offset account without creating any tax complications as it is essentially a savings account. It is extremely important to set up your home loan correctly from the start. Re: Can i afford to live in my home 18Sep 01, 2014 1:18 pm Oran Park 660 Corner If you are planning on the property bring an investment property down the track then borrow the 90% and the LMI. Down the track when you rent it out you will be able to claim the interest on the extra 10% and LMI. Set the loan up as interest only with an offset account which will help with negative gearing once you rent it out. Your minimum repayment will be lower with interest only but still put in as much as you can afford each month into the offset account. If you decide to buy anything like a car or shares or another investment property down the track you can move the money freely out of the offset account without creating any tax complications as it is essentially a savings account. It is extremely important to set up your home loan correctly from the start. yeh this is what I said to my broker what my long term goals were and she did the pre-approval this way So I am on the right track .. good I have a home gym at home. It weights 150KG including the weight stack. I'm a big boy, around 150KG myself. I was thinking about moving it up stairs to the second… 0 6304 We already paid for somfy motors for the blinds. The quote above was purely for “pre-wiring” so the blinds company can install the motors and blinds. That’s why we… 5 16275 I work with owner, he/she is my man on the ground and I instruct them when to visit the site and take photos and I have other tools in the bag. 4 15275 |