Our mortgage brokers have helped a lot of people looking for homes in Rockingham, Kwinana and Baldivis find financing. However, one of the most frustrating situations for many would-be homebuyers is that they often can’t come up with the funds for their deposit.
Luckily, being turned down once due to a lack of deposit funds doesn’t mean that it is going to be that way forever. When we are unable to find a loan for someone due to not having sufficient funds for a deposit, we send them home with a “plan” for improving their financial situation and tell them to try again when they can make a deposit.
Here are some of the basics.
Pay Yourself First
Put money away off of the top of your pay. This is called “paying yourself first.” A savings account is good for two reasons. First, it is helping you amass the funds for your deposit. Second, it is telling lenders that you have the discipline to save money. This causes them to assess you as more likely to pay back your loan. This results in lower interest rates and higher approval rates.
If you can, put 10% of your pay in a high-interest savings account. Make sure that you can’t get to it easily so you won’t be tempted to spend it on impulse.
Stop using your debit card or credit cards. Just pay everything in cash. This makes you feel every dollar you spend and makes you less likely to blow money on expensive items you don’t need.
Pay Off High Interest Debt
Pay off as much of your other personal debt as you can, especially that with high interest rates. It will affect how lenders assess your ability to pay them back. It also makes it a lot easier for you to make your home loan payments. At Smartline Rockingham, we offer personal loans for debt consolidation: (08) 9527 1800.