As a seasoned mortgage broker, I understand that getting your finances in order is a crucial step in purchasing your first property. It's important to know what you can afford before diving into the home-buying process. There are two main paths you can take when looking for a mortgage. You can either approach a lender directly, each offering its own set of products with specific terms and conditions, or you can opt for the second path of working with a mortgage broker to find the best deal tailored to your needs.

Mortgage brokers like myself have access to a variety of loans from different banks and lenders. Our role is to find the most suitable loan for your situation and liaise with the lender on your behalf. Our services are free to you as our income comes from the lender who secures your business. It's important to note that we adhere to a strict code of conduct that ensures we do not favour one lender over another.

Here are some key questions your broker should ask you during your meeting:

1. Do you have a deposit?

The standard measure for a mortgage is known as the Loan to Value Ratio (LVR). It is based on the lender offering 80% of the home's value, with your 20% deposit covering the remaining amount. If you are unable to provide a 20% deposit, the bank may require you to obtain lenders mortgage insurance. This insurance protects your lender in case of default. However, keep in mind that the monthly premium for this insurance will decrease the maximum amount you can borrow, so it might be beneficial to save a bit more for your deposit before proceeding.

2. Do you have other savings?

3. Are you a saver or a spender?

4. How long do you plan to own the property?

5. Will your family situation change?