How to buy a house
It’s easy to feel overwhelmed by the home-buying process, it’s one of the largest purchases you’ll ever make. And while we can’t make the butterflies go away completely, we can let you know what could be around the corner so you can plan for a more simple and stress-free experience.
1. Preparing to buy
The first step in finding the right property at the right price, is being confident about what you could afford.
When buying, your deposit is the amount you’re able to pay upfront for the home, and the rest is normally borrowed in the form of a home loan. Generally, you need to have at least a 20% deposit to buy a property. This is 20% of the property’s value based on the bank's valuation (also known as a loan-to-value ratio under 80%).
For example, if we value the home at $500,000, you’d need at least $100,000 for your deposit.
Don’t quite have a 20% deposit?
You have a few options:
- Check which grants and concessions you're eligible for (see below).
- Pay Lenders Mortgage Insurance (LMI) – you could pay this cost on top of your deposit or include it in your home loan amount. Our upfront costs calculator estimates how much LMI and stamp duty you might need to pay.
- Consider our Family Security Guarantee1, where a family member could save you from paying LMI.
- Continue to save more deposit: our home saver calculator helps you estimate how long it’ll take.
Finding ‘the one’ can take time, expect some disappointment and butterflies along the way.
Now you know your price range and have your pre-approval, you're ready to find the right property for the right price. Review the real estate sites, chat to locals and consider these house-hunting tips:
- Try entering your price range and expanding the map view to see if any unexpected suburbs pop up
- Set alerts so you know when a matched property comes on the market
- The romance of a fixer-upper can fade when your experience, time and budget come into play
- Meet local real estate agents, they might call you first about off-market properties
- If it’s been on the market a long time, the owners might entertain a low-ball offer
- House-hunting can be like finding a partner: be prepared to have your heart broken, then find something better.
Not to be confused with a real estate agent, a buyer’s agent is a property-buying professional who you can choose to hire. They specialise in searching for, scoping out and evaluating properties, as well as negotiating or bidding at auction on your behalf. Their clients can include first home buyers, interstate ‘rentvestors’ and investors, and time-poor house hunters looking for the best price and a competitive edge.
3. Finalising your loan
Almost there. Once you’ve exchanged contracts, we’ll need to value the property to finalise your application.
You can still apply for full approval with us if: your conditional approval’s with another lender but you want a Westpac home loan instead; you’ve signed a contract without conditional approval; or your other lender can’t give you full approval.
- There’s no guarantee we can give you a ‘yes or no’ within any cooling off period you have (uploading your documents ASAP can speed up your application)
- Once you enter into the legally-binding contract, if we can’t offer you full approval you may lose your deposit to the vendor, unless you can find finance elsewhere
- Starting your application at this stage could delay your settlement.
The home stretch. Settlement day’s generally 30-90 days from contract exchange, though it depends on your agreement.
When your loan’s ready for settlement, we’ll let your conveyancer/solicitor know to book a settlement date. They’ll tell you how your payment of funds are to be distributed, like the amount and payee for the cheques. Interest charges won’t apply until settlement day.
Sometimes there are things out of your control that might delay settlement, like problems during your final inspection or incomplete paperwork. Depending on your state or territory, delays could mean a date extension, penalty interest charged to you or the vendor, or the vendor being able to end the contract or even keep your deposit.
Tips to minimise delays:
- Coordinate. Work closely with your conveyancer/solicitor, Westpac home lending manager or broker (if you have one) to help move everything along smoothly
- Be organised. If you’re sent documents, check, sign and return them quick-sharp
- Attention to detail. Before signing your loan documents, check the deposit amount hasn’t changed, your name’s spelled correctly etc. And if you have a mortgage broker, have them double-check everything.
Things you should know
Credit criteria, fees and charges apply. Terms and conditions available on request. Based on Westpac's credit criteria, residential lending is not available for Non-Australian Resident borrowers. This information has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness of the information and, if necessary, seek appropriate professional advice. This includes any tax consequences arising from any promotions for investors and customers should seek independent advice on any taxation matters.
1Family Security Guarantee: The guarantor should consider the risks associated with the Family Security Guarantee, mainly that if the borrower defaults on their loan, the guarantor is liable to pay up to the maximum of the portion of security they’ve put forward as a guarantee. You’ll be required to seek independent legal advice before offering to guarantee a loan. Credit criteria apply to the assessment of the adequacy of any proposed guarantee limit.
Family Security Guarantee can be provided by parents or legal guardians, siblings, and children. Equity access, owner builder applications, Line of Credit and Bridging Loan products are not eligible under the Family Security Guarantee. Other Exclusions may apply. Not available for the purposes of debt consolidation, owner builder construction, cash out, or addition of a security guarantee to an existing loan. $150k minimum loan size applies. Credit criteria, fees and charges apply. Offer may be varied or withdrawn at any time. Full eligibility criteria on the Family Security Guarantee is available on request.
2Break costs on fixed loan prepayments and switching: customers can make total prepayments of up to $30,000 (cumulative) for fixed loans, without costs or fees applying. You may incur a break cost and administration fee if your prepayments exceed this threshold, or if at any time before the end of a fixed rate period you switch to another product, interest rate (fixed or variable) or repayment type.
3Redraw facility: if you have ‘available funds’ (you’re ahead on your home loan repayments) and you’ve activated your redraw facility, you’re free to redraw them with no redraw fee. Read our for full details. Redraw will not apply if you have a Bridging Loan.
4Repayment holiday: Conditions, eligibility and suitability criteria apply.
- Reduced loan repayments: reduction of up to 50% available for up to 6 months on variable home loans held with us for over 12 months. It is important to understand that at the end of the reduced repayment period, the repayment amount will increase to adjust for the reduced repayments. This ensures that the loan is still repaid within its original term. Read the disclosure documents for your selected product or service before deciding if this option is right for you.
- Mortgage repayment pause: available for up to 6 months on variable home loans held with us for over 12 months.
- Parental leave: if you’ve held your variable home loan with us for over 12 months, you could be eligible to reduce your home loan repayments up to 50% for up to 12 months while on maternity or paternity leave, subject to approval.
* An automated valuation model estimate (AVM Estimate) is a statistically derived estimate of the value of the subject property. An AVM Estimate is generated (i)by a computer driven mathematical model in reliance on available data; (ii) without the physical inspection of the subject property; (iii) without taking into account any market conditions (including building, planning, or economic), and/or (iv) without identifying observable features or risks (including adverse environmental issues, state of repair, improvements, renovations, aesthetics, views or aspect) which may, together or separately, affect the value. An AVM Estimate is current only at the date of publication or supply. An AVM Estimate must not be relied upon as a professional valuation or an accurate representation of the market value of the subject property as determined by a valuer. CoreLogic expressly excludes any warranties and representations that an AVM Estimate is an accurate representation as to the market value of the subject property. To the full extent permitted by law, CoreLogic excludes all liability for any loss or damage howsoever arising or suffered by the recipient, whether as a result of the recipient's reliance on the accuracy of an AVM Estimate or otherwise arising in connection with an AVM Estimate.
#Premier Advantage Package: Conditions of Use and $395 annual package fee applies. You must either hold or be approved for a Westpac Choice transaction account in order to qualify and continue to receive the benefits of the Premier Advantage Package. Applicants must have a Westpac Choice transaction account linked to the home loan at the time of settlement and must keep this account open for 60 days after settlement. Before deciding to acquire a Westpac Choice account, read the terms and conditions, and consider whether the product is right for you. Tax consequences may arise from this promotion for investors and customers should seek independent advice on any taxation matters.