Insider Tips for First-Home-Buyers – Don’t Get Caught by Hidden Costs!

Are you dreaming of owning your first home?

Congratulations! You’re about to embark on a journey that will be both exhilarating and overwhelming. At Connect Me Mortgages, we know that buying your first home is a milestone that you’ll never forget. However, there’s more to it than just finding a place and signing a contract.

That’s why we’ve compiled insider tips that others won’t tell you. These tips will help you navigate the process with ease, avoid hidden costs, and achieve your dream of owning your first home.

Insider Tips…

The very first step is to get pre-approval. Pre-approval is a free service offered by most banks, lenders, and us! It gives you an idea of how much you can borrow, what your repayments will be, and what kind of properties you can afford. Wait until you have this before you start looking at properties! Or, you could fall in love with a property outside of your price range. We see this happen often.

This will help you narrow down your search to properties that are within your budget. Saving money, and heartache. Once you have your pre-approval, you’ll know how much you can afford to spend on your new home, and the property hunt begins…

You may have found the perfect property, but before you make an offer, there are a few things you need to know to help you navigate the process like a pro.

First up, when you find a property you love, make sure you’re ready to make an offer. Request the buyer’s information pack from the real estate agent, including the sale and purchase agreement, any vendor disclosures, and obtain a quote for house insurance. We’ll help you confirm with the bank or lender that the property meets their mortgage security requirements before you make your offer.

TIP: If there are no vendor disclosures, you should get this in writing from the real estate agent.

Once you’re ready to make your move, consult with a conveyancing professional or lawyer to help you put your offer together and provide legal advice related to the contract and property. While Connect Me Mortgages doesn’t provide this service, we can support you in this process.

If you’re relying on KiwiSaver or First Home Grants, be sure to give yourself enough time between the unconditional date and the settlement date, as providers vary in how much notice they need to release this.

Let’s help you seal the deal! Make sure you can meet the deposit requirements or if not, get approval via the agent (or vendor’s conveyancer/lawyer if a private sale) to amend the deposit requirements.

But wait, there’s more!

The hidden costs of the buying process…

We’ve compiled a list of the hidden costs you may encounter during the buying process, such as legal fees, building inspection reports, and valuations.

• Legal Fees – You’ll need to engage a conveyancer/lawyer to handle the legal aspects of your purchase, this can range from approximately $1,200 through to $2,400 – however it pays to shop around and get a quote before you engage a conveyancer/lawyer, as costs can vary. Note: If you are using KiwiSaver withdrawals or First Home Grants, or if you have a Trust or guarantors involved this will increase legal costs.
• Building Inspection Report – You may want to get a building inspection report to identify any issues with the property, or to understand what future maintenance may be required. This will range from approximately $650 through to $1,000 depending on the size and type of the property, there may be additional costs if specialist testing is required.
• Land Information Memorandum (LIM) report / Property Information Memorandum (PIM) report – You’ll need to obtain this from the Council, these reports will range from approximately $350 through to $550 and can cost more if you require an urgent report.
• Registered Valuation – If your lender requires it, you’ll need to get a registered valuation. This will range from approximately $850 – $1100 depending on the size, value and type of the property. Where a valuation is a condition of a bank’s approval, the valuation must be ordered through their panel of approved valuers — talk with us to assist with ordering the valuation.

With our help, you’ll be ready to make your move and start creating memories in your new home.