Criteria for buying your first home Melbourne

Getting prepared when buying your first home allows you to be organised and in control of your money, and your future.

The main criteria for buying your first home include saving a deposit, knowing your borrowing limit, getting approval for a home loan and understanding your repayment options.  You may also be eligible for the government's first homebuyer grant.


Save Save Save
If you can save a deposit, you will have better choices when it comes to which home loan to choose.  Plus, the more deposit you put down the less you will have to borrow which means the less interest you pay.  Usually 10% of the property price is required, so if you are looking for a home in the region of $300,000 you will need to save $30,000.  If your dream is to own your own home, then you may have to rethink that overseas holiday or expensive car, and consider if you can save money by cooking for friends at home instead of eating out.  You could also look at your mobile phone bill and gym membership to see if there is money to be saved.

Borrowing Limits
This is crucial, as to be taken seriously as a potential buyer by agents you need to know the range of credit you can get.  Talk to lenders and try to get pre-approved by a bank or non-bank lender.  Pre-approval means that you pass the lender's basic criteria for a home loan, but the loan will not be fully approved until the property you choose is valued. 

Getting Approval
If you have a safe and regular income, a good credit history and records of your finances dating back at least two years then you shouldn't have problems getting credit, however you may find you are knocked back for a loan if you cannot meet the lending requirements of the bank or credit union.  It is advisable to contact a mortgage broker for some assistance in finding a great loan and gaining approval.

Repaying the Loan
Look at whether you want to pay weekly, fortnightly or monthly (sometimes paying more often than monthly can save you money) and also consider if you want or need features such as early repayments and redraw facilities.  Make sure you set out a budget, including every source of income as well as every expense you have to ensure that you can afford the repayments. 

First Home Buyer Grant
The First Home Owners Grant was increased in 2008 but is now due to be reduced as of 31 December 2009.  The original first home owners grant of $7,000 is still available to eligible first home buyers after this date. 

The grant was boosted by the Federal Government during the global financial crisis to boost the property market but is now winding back to the original $7,000.  The grant is designed to help first home buyer onto the property ladder.

If you would like more information on what you can claim please contact your nearest mortgage broker.


There is a lot to consider when buying your first home but a mortgage broker can make it all very simple and easy.  Contact a broker in your area by calling or submit your details on line.