7 Signs You're Ready to Apply for a Home Loan in 2025: Don’t Miss Your Moment
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Buying a home is one of the biggest financial decisions you'll ever make. For many in Australia, 2025 might be the year to finally take that leap.
But before you jump in, it’s crucial to know if you’re genuinely ready to apply for a home loan. From saving a solid deposit to having a clear credit record, several factors determine your readiness.
In this article, we’ll cover seven clear signs that you're in a good position to apply, plus tips to help you move forward with confidence. Let’s dive into what really matters when it comes to home loan readiness.
1. You Have a Stable and Reliable Income
Lenders want to see a consistent income stream. If you've been in the same job or industry for at least six to twelve months, that’s a strong start.
- A full-time role with regular hours works in your favour.
- Self-employed? Ensure your business income is steady and well-documented over the past two years.
- Avoid changing jobs right before applying for a home loan, as this can raise questions for lenders.
A stable income shows that you're financially dependable, making you a lower-risk borrower.
2. Your Credit Score is in Good Shape
Before applying for a home loan, it’s important to check your credit score. This three-digit number can make or break your loan application.
- Scores above 700 are considered good in Australia.
- A clean credit report with no defaults, bankruptcies, or late payments gives you a strong advantage.
- You can check your score for free using services like Equifax, Experian, or illion.
If your credit history has some blemishes, it may be worth taking a few months to tidy things up before applying.
3. You’ve Saved a Sufficient Deposit
Generally, lenders in Australia prefer a deposit of at least 20% of the property’s value. However, you may still be eligible with as little as 5%, depending on the lender and your circumstances.
Here’s what to consider:
- The larger your deposit, the less you’ll pay in interest and Lenders Mortgage Insurance (LMI).
- Many government grants and schemes can assist first-home buyers with their deposits.
- Genuine savings, money saved over time, not gifts or windfalls, can also improve your chances.
In North Brisbane, house prices vary, so working with a mortgage broker can help determine how much deposit you’ll realistically need.
4. You’ve Budgeted for Upfront Costs
Beyond the deposit, buying a home comes with several additional costs, including:
- Stamp duty (though concessions may apply)
- Conveyancing or legal fees
- Building and pest inspections
- Loan application fees
- Moving costs
You should have a separate budget prepared for these expenses. If you’ve accounted for them and still have some buffer left over, that’s a strong indicator that you’re ready to apply for a home loan.
5. You’re Managing Existing Debts Well
Lenders look at your existing debt to assess your borrowing power. This includes:
- Credit cards
- Personal loans
- Car loans
- Buy Now, Pay Later services
Ideally, you should:
- Pay down credit card balances or cancel unused cards
- Avoid taking on new debt while planning your home purchase
- Keep your debt-to-income ratio low
Being in control of your debts signals that you're financially responsible and capable of managing a mortgage.
6. You’ve Done Your Research on the Property Market
You don't need to have a property picked out just yet, but understanding the market is a must.
- Do you know the average home prices in your desired North Brisbane suburb?
- Have you spoken to a mortgage broker about your borrowing capacity?
- Are you aware of current interest rates and how they impact repayments?
The more you know, the better decisions you can make when it’s time to buy. Research shows you're serious and committed, both of which lenders value.
7. You’re Ready for the Long-Term Commitment
A home loan is a long-term responsibility, typically 25 to 30 years. Before applying, ask yourself:
- Are you planning to stay in the area for several years?
- Are your employment and lifestyle stable?
- Have you discussed future goals with your partner, if applicable?
If your answers align with long-term stability, you’re more likely to stay on track with repayments and meet lender expectations.
Bonus Sign: You’ve Spoken to a Mortgage Broker
One of the smartest things you can do before applying is to sit down with an experienced mortgage broker.
A broker can:
- Help you compare loans from various lenders
- Show you your borrowing capacity
- Guide you through the paperwork
- Assist with government schemes
If you’ve already had that chat, you’re probably closer to applying for a home loan than you think.
FAQs
How much deposit do I need to apply for a home loan in Queensland?
Typically, you’ll need at least 5–20% of the property’s value. A 20% deposit helps you avoid LMI.
Can I apply for a home loan with a low credit score?
Yes, but your options may be limited. Speak with a mortgage broker to explore suitable lenders.
What documents are required when applying for a home loan?
You’ll need payslips, bank statements, identification, tax returns, and details of your assets and debts.
How long does it take to get home loan approval?
Pre-approval can take a few days. Full approval usually takes 1–2 weeks, depending on the lender and complexity.
What is Lenders Mortgage Insurance (LMI)?
LMI protects the lender if you default on the loan. It’s typically required if your deposit is less than 20%.
Can I apply for a home loan while on probation?
Some lenders may accept probationary employment, but it depends on your industry and loan type.
Should I get pre-approved before house hunting?
Yes, pre-approval gives you a clear budget and strengthens your offer when making a purchase.
Ready to Apply for a Home Loan?
If you nodded along to most of the points above, chances are you’re ready to apply for a home loan in 2025. That’s a huge achievement and something to be proud of. To move forward with clarity and confidence, partner with a trusted professional.
If you’re looking to buy in North Brisbane, Kelly Brothers Finance are expert North Brisbane mortgage brokers who take the stress out of securing a home loan. Whether you’re a first-time buyer or upgrading your family home, we’re here to guide you through every step of the journey. Call us at 07 3847 9450 to book your free consultation today.