House and Land Package Finance - Nervous First Home Buyers

Hey Guys,

My partner and I took the dive yesterday and put a small holding deposit on a House and Land Package ($479K).

Our situation is as follows and we are wondering how we are looking finance wise:

Combined income - $80,000/year
Genuine Savings - $45,000 - We are also planning on using the full $20,000 FHOG Grant as part of our deposit to push it to $65,000.
We have no debt currently and no defaults on record, partner just paid off her 5 year car loan in 1 year (not sure if this looks good).
Never had a credit card between us either.

We recently relocated to QLD from Sydney and have been in our jobs for about 1.5 months each but previously were in stable employment for about 2 years. We have both remained in the same industry which I believe plays into our favour and we have signed full time contracts with pay etc.

We also have the necessary 3 recent pay slips from our current positions.

Everyone we have spoken to has told us our significant deposit and lack of any debt mean we are in a very comfortable position to receive the loan.

Based on the figures I have looked at if we put $65,000 towards the purchase of the home we should only be requiring a loan of around $425,000 however I suspect we will apply for somewhere around the $430,000 just in case there are any small surprised, but we aren't too worried as we have signed a fixed price contract.

Any advice or re-assurance would be amazing.

Hey Caydenn, welcome to Home One.

Your situation is similar to ours, our combined income is higher although our loan will also be a little bit more so the income:loan ratio are still similar. Your numbers and savings sound great.

If I could please just add in my experience, I switched jobs and had only been in my new job for one month when we put our deposit on land and because we were borrowing more than 80% (we didn't have 20% deposit) the bank couldn't process our application until I had been in my job for 3 months even though my previous job was stable for the last 4.5 years and I was doing the same work, just for a different company (this is Westpac btw). We were lucky our land wasn't technically released and for sale yet so that bought us time and the developer held it for approximately 3 weeks after it's release date (after a bit of negotiating) for us but the 3 months was nearly finished. Our slab is being poured on Friday - finally!

Obviously talk to your finance/broker but thought that could be useful for you. Hope to see it all work out for you, it is an exciting process - will follow your feed.

Thanks so much for the reply, we are really hoping that we don't need to wait for the 3 months as we will then lose out on $5,000 of home owners grant and likely lose this package unless we can pull out a miracle.

Hard not to get emotionally invested when you start putting down deposits and going to stand on the land and start calling it yours. We are going to see our mortgage broker next weekend and he sounded confident he could argue against the 3 months. I have also spoken to NAB and Commbank and both advised that with signed contracts and pay slips that it shouldn't make a difference, but you never know with these things.

Holding thumbs but can't concentrate at work today, all I can think about is hoping this all works out after years of saving and hard work.

HI Caydenn, I haven't run the numbers on affordability as thats a much bigger conversation. Your broker has the full story so I would trust them. As mentioned above, the majors are usually really good in this space, even able to consider probation if the history is good and your broker will highlight all of the strengths to get this over the line. There are others who will as well. It will help you a lot if you can keep the borrowings under 90% (so keep saving before its time to start building), you're very close now - it will save you a lot in mortgage insurance, Best of luck and enjoy the building process!!