Self employed with first year Nurse looking to buy first home

Hi All.

First time posting so I apologise if this is the wrong place to post.

Our rental is coming up for sale in NSW, we currently pay rent of $360pw. I’ve been paying this for over 18 months. Prior to that we lived with in laws for 8 months, prior to that rental at $350pw for a year. Also 18 months rental prior to that at $250pw.

The house will be for sale for $380k, we are thinking $370k will buy it. It’s a good house and ideal for us.

We have 10% $37k for a deposit.

I am self employed, have been in business for 4 years, 17/18 return profitable but not overly strong $20k profit (paid wife wages of 12k for the year) total turn over $75k. Returns previous to that are also profitable but fairly low income (accountant doing a great job)

18/19 return will be stronger, low estimate at 50k profit and total turnover of 88k.

My wife finished uni and started full time (post grad year) in January this year. Her salary is around 60k. She finishes her post grad year in a few months and will start a 12 month position in January. She will also receive a slight increase in pay. She has a year of payslips.

I have business (4 years) finance on my work Ute, $681 a month, this finishes in April with a balloon of $3900

My wife has a car but the loan is in her fathers name and she makes payments of $250 a fortnight to him.

Besides a Go MasterCard $2k with about $300 left owing we have no other debts besides phone contracts. Oh my wife uses Afterpay which is sitting at around $700, she is going to pay this off and get rid.

We are going to talk with a reputable broker on Monday.

Are we dreaming to even go for it or is the $333k we’ll be borrowing a pretty small loan? The repayments would be so similar to rent, just one of our incomes could Service the payments no problem at all.

I’ve tried to provide as much insight to our situation as possible,

Any advice or pointers to get us ahead on this would be greatly appreciated! Thanks

 

I reckon you'll be OK , broker will confirm once they've looked at your borrowing capacity, it'll be close but not impossible. Consider your monthly living expenses.

 

Just remember on top of loan repayment. Other home ownership costs about $100 per week.

 

Thanks,

Excluding rent our weekly expenses are probably around $550-650. I pull in around $1500-2200 a week at the moment but by the nature of my work that varies throughout the year. my wife’s bringing home around $1200 a week after tax. Outside of our 37k deposit I am keeping aside as close to $10k for an emergency fund as possible. My in-laws have offered to lend us $5k if we need it to, they may also be open to the option of guarantor but I’d really rather not have to ask them for that. So if necessary we can stretch to more in the deposit but I’d really rather not leave leave ourselves totally broke.

Our thinking is that borrowing a fairly low amount will allow us to continue saving/living pretty much as we have been up until now while renting. This will allow us to quickly build up a big financial cushion again and allow us to make improvements/repairs comfortably when needed and or save for other investments, travelling etc. Although we play things fairly financially safe, we’re more about living than being hard investors.

Any advice on what sort of Loans we should be asking for? I’m sure our broker will help with this to but open to other educated opinions of course!

Thanks again for your inputs already

 

Your expenses are pretty much in line with the minimum lenders will apply to your serviceability calculations.
As long as no defaults or overdrawn accounts I can't see why you wouldn't qualify for the loan you need.
Good idea to keep a cash buffer if you can.
I guess you just need a loan that allows you to borrow what you need, even better if you have one with an offset account that you can park spare cash in to reduce overall interest payable (offset better than redraw)