Mortgages?
 

Hi, I've done some online mortgage calculators, but can't seem to suss out how they decide borrowing criteria in Oz. Obviously its individually assessed, but there doesn't seem to be the UK equiv like 4.5 x single salary or 3 x joint salary. It seems to be based on outgoings and dependants (which with 4 kids is wiping out our mortgage possibilities!! :) ) Any advice/explanations appreciated. plus do you have to wait 6 months to build up a credit rating?

Mel
:confused:

Re: Mortgages?
 

I've been trying to work this one out too - it would be good to have a basic guide like 3 x joint income, just to get an idea of what we might be able to afford.

Re: Mortgages?
 

Interested to see a reply to this one. Also do you have to be in Australia for a set period of time before obtaining a mortgage?

This is a useful link though to answer some queries.

http://www.infochoice.com.au/aspx/

Re: Mortgages?
 

If you have permenant residency then no problems.

Your a first time buyer so you get a $7000 grant.

Its not about wage.

We were offered a stupid mortgage but it would mean we couldn't enjoy life.

Wages are lower here but so is the cost of living.

Find an area you like (trust the locals not the ex-pats....sorry folks not you lot but other people were arrogant snobs who looked down on areas that were not flush). You'll get housing areas in all subburbs. Look for the nice part of a subburb.

Go to a LOCAL mortgage advisor..not smart line. The advisor gets a commission from the lender - no charge to you - and they do all the paper work.

We got a 4 bedroom with a pool and garden in a great area and can still enjoy life!

Feel free to disregard all the above as your own experience suits.

Re: Mortgages?
 

Thank you for advice. I can't believe how naive I feel. Everything seems so confusing.

We are going to Perth hopefully in June. Wondered how much a 3/4 bedroomed house would cost. Son would love a pool but it will just depend on cost. I have looked online at real estate but as you say you've no idea which are the decent areas.

I am not a snob and don't care how "Flash" the property is but by the same token I don't want to end up in a very bad area either.

:confused:

Re: Mortgages?
 

The amount that a mortgage company/bank will lend is based on how much you can afford to repay. Someone on $50k with no other debts and no dependants has more cash available for mortgage repayments than the next person (also on $50k) who might have personal loans, six credit cards and four kids. Banks have a legal obligation not to lend more than the borrower can afford to repay (they've been in trouble in the past for doing this) and consequently need to know how many kids/debts you have - to ensure that you retain enough cash to feed them!

That's not to say they're mean with their money - they will calculate a loan amount where the repayments could take up every last cent you have left over - hence the silly amounts that they offer some people.

Re: Mortgages?
 

Two good sites are

http://www.realestate.com.au/

and

http://www.domain.com.au/?s_cid=1860

but viewing and buying are very different. I think you should rent first...suss out where you want to go then go for it.

Re: Mortgages?
 

We are in Perth and arrived here in the middle of the house boom.
We got a morgage no problem, even though neither of us were working.
We did have a deposit though.
Unfortunatley we are now being ripped off with the morgage, paying bigger monthly payments as our interest rate is higher than normal since we had no jobs. We are working now but are tied to the debt for 12 months, then we can buy ourselves out of it, which we will do as being ripped off isn't very nice is it.
Be careful what you buy out here as i think the houses are not worth the money at all.

Re: Mortgages?
 

Hmmm ours was. It cost half of what a Renfrew/UK equivilant would cost

Re: Mortgages?
 

Surely you were aware of what the interest rate and terms were before you signed up for the loan? No-one tricked you, twisted your arm and forced you to take it, did they? So it's hardly a rip-off.

The rate was higher than usual because you were a higher risk than the average bloke with a job and a history. I'd have thought you should be thankful that anyone was prepared to take the risk and give you a loan at all...

Re: Mortgages?
 

I'm reading this thread with great interest. We will be flying out to Melbourne a week today :scared: :scared: :scared: .
We are planning to rent for six months but the more we think about it the more we would like to buy ASAP. We have a good idea of whereabouts we would like to settle, do you think we would still be wise to rent first and then buy?

Cheers, Loz.

Re: Mortgages?
 

Loz,

Planning the same thing as you - wondered if it was possible to take a 6 month lease out as opposed to a year. We could offer a good ammount upfront if it would entice a 6 month lease.
Any takers?

*pearly*

Re: Mortgages?
 

do you have to be in permenent employment too, most of the jobs i see are casual to start with. will a lender still do you a mortgage on this basis,,,or will you get shafted on the interest rate?

we were thinking of initialy renting for 6 months too,,,but we feel this is dead money, may be better to find a house as quickly as possible.

live in temporary furnished till then.

mick

Re: Mortgages?
 

Know what your saying but the problem with renting being "dead money" is that the other option - to rent a short let place for say 2-4 weeks while you find somewhere to buy, is that the short lets are AT LEAST $150 night which mounts up to be a fair whack over a month. ( at least $4500 before other costs like internet set up etc ) If you went for a rented place for say $350 a week - that'd be $1400 a month!!!!!! BIG difference.
It's a tricky scenario but I'd say rent a short let for a week or so when you first arrive and spend that week or so finding a 6 month rental or shorter rental so that you have time to look around areas instead of perhaps rushing into making a purchase you might regret.
I know it's really difficult but that "dead money" I'm highly likely to spend on a rental might just buy me the time I need to find a place I really love.

Hope this helps.I've rented before in Melbourne so I have a rough idea of prices etc.

*pearly*

Re: Mortgages?
 

I,m flying out to Brisbane in 7 hours :D

I've got a mortgage sorted out and I'm on a 457, the lady said there would be no problem.

Here's one of the examples

OPTION 1

Loan amount $200,000

Interest Rate 7.47% Variable

Repayments $1,394 per month on Principle & Interest

$697 per fortnight on Principle & Interest



She's sorting out a letter for the morning which will say something along the lines of "yes he has got X in the bank and yes he can borrow X amount"

Re: Mortgages?
 

Renting for 6 months worked well for us.

It was a third of the mortgage repayments so we could look for the right house with no panic and saved up money.

Had no job when we came out...2 weeks had a temporary post, one month had a permenant. Maybe I was lucky but it worked out.

There are a lot more houses than the ones on the net. And many of the ones on the net are there because they can't sell.

Re: Mortgages?
 

Rent first for six months. During that time you will be able to hopefully get jobs and decide where exactly you want to live. As for the "dead money", well yes it is, but its a small expenditure compared to buying a house in an area that you subsequently regret [remember here in WA, stamp duty etc means it can cost you $25000+ dollars in additional costs, agent fees etc just to move to another house at the same price].

Once you've done all that then go and sort out a mortgage.

Re: Mortgages?
 

I dont think there are any guidelines like the UK I think they dream up a figure and times it by 3! :D

The amount of money we were offered by the banks when we came over was stupid and to be honest scared the living daylights out of me as it was nearly 8 times our joint income. :scared:

We didnt need to wait 6 months for a mortgage infact the other half was a temp and I was 1 day in to a 3 month work probation period.

Re: Mortgages?
 

Yeh, my OH got a mortgage no problem and he was out here on his own. The only real issue with being on a 457 is that once you find a house you need FIRB approval to buy it. It's just a matter of completing an application form and submitting - it is usually straight forward. Just another load of red tape to cut through.

M:)

Re: Mortgages?
 

HHmm a lot of eager beavers on here by the sound of things!..my two cents on this is rent for a while.. even 12 months! rent is massive over here, next to the house we bought was a family who have been renting for 6 years!! :scared: thats a $400k property for $340/$350 p/w which is nothing on what you pay for a mortgage repayment up this way, and added to that, just 2/3 main bills per month ..I could see the up side ..very little worry??
OR!! to help folk like me in earning a crust...build :D

Re: Mortgages?
 

But if they got brought that house 6 years ago there repayments would have been a lot less then $350p/w. :)

I can only see rental prices going up anyway, and when that happens more people are going to buy investment properties push house prices up .....

Re: Mortgages?
 

Another option is to go fort he 6 month rental and then if you find somewhere to buy you look to break your lease, basically you are responsible for the rent until they find new tenants. Soem friends of ours did this after 6 weeks in a house and the agent found new tenants vry quickly. They ended up having to pay an extra weeks rent and $200 advertising costs.

Cheers

Paul