What if I don't have a deposit?

September 23, 2014
Dora Platakis

What if I don't have a deposit?


The days of scoring a 100% loan are essentially gone: these days, lenders want to see evidence of some genuine savings before they hand over funds to finance your first home.


So, if you want to have your own little piece of property to call home,  a place where you can paint the walls any colour you like, and hang paintings on every other wall,  you’ll need to start saving.


Here are a few tips that might help you get there.


1, Eliminate the luxuries

Although it’s no fun, a little can be an effective strategy for saving money for your first home deposit. You can start by eliminating or downgrading the luxuries from your life, and then using the cost savings to fund a savings account. You don’t have to skip everything at once, however; instead, eliminate one luxury per month, pocket the savings, and then move on to the next thing.


Over a period of twelve months, you could easily save a few thousand dollars by alternating between life’s little luxuries!



2, Save 10% of each pay

This is a tip that always works if you’re prepared to stick with it - pay yourself before you pay anyone else.


The best way to achieve this is to designate one savings account – ideally at a different bank to your normal lender to make it harder to access the money – transfer 10% of your net pay each pay



3, Budget planner and Savings target

Establish a budget and stick to it –your budget planner will allow you to see where your money is actually going. Tip – Best done according to your pay cycle.


Once your budget is in place, set up your savings target- saving is always easier if you have a set goal in mind.


4, Add any windfalls

Add any financial gifts you may receive from family, your tax refund or any work bonuses to your savings pool.



5, Sell stuff on eBay

eBay is the ideal place to offload your unwanted household items in return for cold hard cash!



6, Pay off your debt

Not exactly a straight savings tip, although it’s by default.  Paying off your debts makes sense for two main reasons: it will increase the amount of money you can borrow, and it will free up your cash to use towards mortgage repayments.



7, Get a part time job

If you’re serious about saving a home deposit and your finances are already stretched to capacity, then consider looking for extra work. By working a couple of evenings a week, you could easily add $1,000 a month to your bank account, or $12,000 over 12 months.


8, Guarantor loan

 An option that could be available to you.


For a budget planner or any further assistance, contact Dora and her team on:

Email: dora.platakis@mortgagechoice.com.au

Ph: 03 93605968   M: 0413 636 645

Posted in: First home buyers

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