Whether you are a first-home buyer or you are buying your 10th property, you need a power team to support you. Let’s face it, you cannot be an expert on everything, which is exactly why you need to work with people who are experts in their field so you make wise, intelligent investments.
Not assembling a team to support you when buying your first home, could be an expensive mistake to make. For instance, a mortgage broker can secure you the best loan, a solicitor helps you with due diligence and a good real estate agent can help you find the right property and negotiate on your behalf. You are much more likely to succeed and make the right investment when you have a team to help you out. Trust us, it will be worth every penny.
We recommend your power team consists of:
- Mortgage broker
- Real estate agent/property advisor
- Accountant (if you are self-employed)
Let’s take a look at how each of these people can help you and why they are important.
Unless you happen to be an expert in the banks’ complex lending policies and the technical rules, you’re going to need a mortgage advisor. A mortgage broker knows all the ins and outs of lending policies and rules, and they are constantly staying up to date with the policies and rules of each bank.
Not only can a mortgage advisor help you get your lending approved, they can also help you set it up and structure it in the right way. A mortgage advisor acts as your representative to the banks and other lenders, and they know which banks lend to which type of people, and on which properties. Furthermore, a mortgage advisor will negotiate with the banks on your behalf to ensure you get the best interest rate and lending.
A mortgage broker can also help you set up the loan so you can keep lending in the future if you’re planning to buy more properties.
Of course you could spend an afternoon using the banks’ various calculators trying to figure out which banks will lend you what. However, you won’t have access to the behind the scenes bank policies, and let’s get real, you probably could spend your afternoon doing something way more fun than crunching numbers.
A mortgage broker can help you get the loan in the first place, set up the mortgage in a way that works best for you, and they can help you get a cheaper interest rate.
And guess what? Most of the time working with a mortgage broker is completely free as mortgage advisors get paid by the bank once the loan goes through. However, on the odd occasion you have to pay for their service but they will always disclose this upfront before you start working with them.
If you would like personal financial advice, you can book a meeting with us here.
You are absolutely going to need a solicitor when you are buying your first home (or your 27th home for that matter). A solicitor can help you with due diligence and he/she will also go over all the paperwork and give you advice. Having a solicitor is crucial. However, you shouldn’t just choose any solicitor. For instance, you may have a good friend that specialises in environmental law. That is all well and good – if you need advice on water law or climate change law. It is, however, not the person you want to seek advice from when it comes to buying property.
You need to work with someone that’s an expert in their field. A lawyer will handle all the paperwork and transfer the money from you and the bank to the person selling the property. The solicitor will also manage the title of the property.
By choosing the right solicitor you ensure that you have all the right clauses in your contracts so you’re protected, he/she will look over the LIM (Land Information Memorandum) Report and more. If you choose to work with your friend that’s an expert in environmental law you could potentially end up buying a property you don’t fully understand and agree to clauses you shouldn’t have agreed to. So choose a quality lawyer that specialises in property so you know you’re getting the best advice possible.
Lawyers charge different fees, but generally you should budget between $1,500 and $4,000 (including GST) for their services.
Real estate agent
Most people only buy properties a handful of times in their life, and as a first-home buyer the process of finding and buying a house can be overwhelming. A real estate agent does this for a living, meaning they know exactly (hopefully) what they’re doing, and you definitely need one on your side, especially as a first-home buyer. First and foremost a real estate agent can help you find the right property so you don’t have to spend hours scrolling through the market every night before bed. When you do find the property the agent can help you determine the value of the house and negotiate on your behalf. Most first-home buyers find the whole process of negotiation rather nerve wracking so why not just leave it to the professionals and avoid sweaty palms and sleepless nights?
Accountant (if you are self-employed)
Most first-home buyers won’t need an accountant. Usually, an accountant is only needed if you’re buying investment properties. However, if you are self-employed you might want to consider working with an accountant. Say your business goes belly up, you don’t want the IRD, the bank or anyone else coming after your property. You basically want to have your exposure covered. For instance, it may be best to buy the property under a trust to protect yourself.
Just like with a solicitor you want an accountant that specialises in property so you can get quality advice.
Everything shared in this blog post is general financial advice. For financial advice tailored to you, please book a meeting with us.