ExploreFirst Home Buyers Starter Kit
A clear, step-by-step guide to confidently financing your first home in Western Australia.
Welcome
Buying your first home is a major financial decision. This guide explains how banks assess you, what you genuinely need in savings, and how to position yourself for strong approval. The goal is not just approval. The goal is approval that is strong, stable and sustainable.
How Banks Assess Your Borrowing Power
Borrowing capacity is calculated using five core factors:
• Income – salary, consistent overtime, bonuses and rental income.
• Existing debt – credit card limits, personal loans, HECS/HELP and car finance.
• Living expenses – compared against bank benchmarks.
• Deposit size – determines your Loan-to-Value Ratio (LVR).
• Interest rate buffer – assessed at approximately 3% above current rates.
Capacity vs Approval (The WA Reality)
You might qualify on paper to borrow $1,000,000. That does not automatically mean a lender will approve you for that amount.
Approval depends on both serviceability and risk. Your deposit strength directly influences how a lender views risk.
In WA, high-LVR purchases may attract stricter valuation scrutiny and postcode overlays. A slightly lower purchase price with a stronger deposit often leads to faster approval and better pricing.
What You Actually Need in Savings (WA)
Beyond your deposit, you must allow for:
• Stamp duty (unless eligible for concessions)
• Settlement agent fees
• Building and pest inspections
• Council and strata adjustments
• Moving costs
Loan Structure Matters More Than Rate
Interest rate matters. Structure determines flexibility.
• Offset accounts provide flexibility and reduce interest daily.
• Redraw reduces interest but may limit access.
• Fixed loans provide certainty; variable loans provide flexibility.
• Split loans can balance stability and control.
Ready to Take the Next Step? Ian Freeman Mortgage Broker | Finance 365 | 0439 365 365 ian@finance365.com.au ianfreemanfinance.com.au Credit Representative Number: 439731