Costs of purchasing a Property
You’ve decided it’s time to buy or build a new home and you will need to obtain finance. When thinking about taking out a mortgage or home loan, you will need to take into consideration other fees and extra costs. Some of those extra costs include:
Home Loan Application Fees
Most lenders charge a home loan application fee and these can vary from loan to loan. These fees can cover Loan Contracts, Property Title Checks, Credit Checks and attending a settlement.
Mortgage Fees and Costs
Depending on the type of loan or mortgage you are applying for you can expect to be paying fees on:
- Mortgage Establishment Fees.
- Property Valuation: A third party chosen by the lender is appointed to determine the value of your land and/or improvements.
- Mortgage Registration: Your mortgage deed needs to be registered with the government.
- Mortgage Stamp Duty: Some State Governments charges stamp duty to register your mortgage.
- Lenders Mortgage Insurance: If you don’t have 20% of the purchase price or the value of the property, the lender will require you to pay for a lenders mortgage insurance policy that covers their risk in the event you default on your repayments.
Property Fees and Costs
There can be many costs involved when purchasing a property that you are not only legally required to complete but some that are very important pre-purchase. These can include Building Inspection fees, Stamp Duty, Registration of transfer fee with the Land Titles Office and Legal fees for the transfer of ownership of the property on your behalf.
Other Ongoing Costs
Once you have moved into your new property there are other ongoing costs that need to be thought about before applying for your loan.
These can include:
- Home & contents insurance – Most homeowners insure their home and contents against a range of threats: burglary, fire, storm, etc. Lenders insist that your property is insured while you have a mortgage.
- Life and income protection insurance – Borrowers should consider protecting their incomes and themselves while they have a mortgage.
- Utility costs – Connecting electricity, gas and telephone can attract a fee.
- Council Rates – Your local council charges rates to cover garbage collection and a host of other services.
- Water Rates – The water corporation charges rates for the supply and upkeep of water to your property.
- Body corporate fees – If you buy an apartment or Strata Titled property, body corporate fees are charged, and some fees can be significant – particularly if the building is in need of a major work (e.g. concrete cancer, security upgrade, new hot water system, etc) or if there are lifts, pools and other communal facilities.
- Maintenance costs – Don’t forget to make provision for regular maintenance on your home – even if you decide not to undertake significant renovation.
This is where working with an experienced mortgage broker such as Annette really pays off. Annette will work through the entire application process with you to ensure that you not only get the correct finance that suits your needs but that you are aware of all costs before making a final decision.
Need some Advice about loans?
A mortgage broker can help you find the right loan and secure the finance that’s most suitable for you. It will also ensure you avoid making mistakes.
Any questions you may have regarding loans, contact Annette Tothill on 0420 973 551.