First Home Buyer Checklist Melbourne 2026 — What to Do Before You Apply

If you are a first home buyer in Melbourne planning to apply for a home loan in 2026, preparation is the single biggest factor that separates a smooth approval from a frustrating one. Banks assess far more than just your income — and most buyers discover this too late, after an application has already been submitted.

This checklist covers everything you need to have in order before you approach a lender or a mortgage broker. Work through it section by section and you will start your application in the strongest possible position.

✅ Step 1: Know Your Deposit Position

Before anything else, calculate exactly how much genuine savings you have. Lenders distinguish between:

• Genuine savings — funds held in your own account for at least three months, regularly accumulated

• Non-genuine savings — gifts, inheritance, or lump-sum deposits that do not demonstrate savings behaviour

• Equity — if you already own property, usable equity may supplement your deposit

For most lenders, you will need a minimum 5% deposit for a 95% LVR loan, or 20% to avoid paying Lenders Mortgage Insurance (LMI). Some government-backed schemes allow purchases with a lower deposit without LMI — eligibility depends on income thresholds and property price caps. Your mortgage broker will assess which pathways apply to your situation.

✅ Step 2: Check Your Credit File

Request a free copy of your credit report from Equifax, Experian, or Illion before any lender does. Look for:

• Any defaults or overdue accounts — even small, forgotten utilities bills

• Excessive credit enquiries from previous applications

• Credit card limits (lenders assess the full limit, not just the balance)

• Buy Now Pay Later accounts (Afterpay, Zip, etc.) — treated as credit commitments

Addressing credit issues before you apply is far preferable to discovering them mid-application. Even a single small default can disqualify you from mainstream lenders, though specialist lenders may still have options.

✅ Step 3: Understand Your Borrowing Capacity

Your borrowing power depends on more than your salary. Lenders apply:

• A stress-test buffer of 3% above the advertised rate

• HEM (Household Expenditure Measure) benchmarks for living costs

• Debt-to-income ratio limits

• Assessment of all existing liabilities — personal loans, HECS, credit cards

Different lenders produce substantially different borrowing power estimates for the same applicant. A comparison across multiple lenders, conducted by a broker before any formal application, can reveal meaningfully higher borrowing capacity than a single bank's estimate.

✅ Step 4: Check Grant and Stamp Duty Eligibility

Two major financial benefits are available to eligible Melbourne first home buyers:

First Home Owner Grant Victoria

A $10,000 grant for eligible buyers of new homes. Eligibility conditions:

• Purchasing a new or substantially renovated home — not established properties

• Purchase price within the applicable cap for your region

• At least one buyer must occupy the property as their principal place of residence for at least 12 continuous months, commencing within 12 months of settlement

• No previous FHOG claimed in any Australian state or territory

Stamp Duty Concession Melbourne

First home buyers in Victoria may be eligible for a full or partial stamp duty exemption depending on property value:

• Full exemption: properties up to $600,000 (principal place of residence, eligible first home buyers)

• Partial concession: properties valued between $600,001 and $750,000

• No concession: above $750,000

These thresholds and eligibility criteria are subject to change — always confirm current rules with your broker or the State Revenue Office Victoria before signing a contract.

✅ Step 5: Gather Your Documentation

Lenders require a standard set of supporting documents. Having these ready before your broker meeting will significantly speed up the process:

• 100-point identity verification (passport + driver licence)

• Last 3 months' payslips (PAYG employees) OR last 2 years' tax returns and notices of assessment (self-employed)

• Last 3 months' bank statements — savings account and any transaction accounts

• Last 3 months' statements for any existing loans or credit cards

• Evidence of deposit: savings account history showing genuine accumulation

• HECS-HELP balance (if applicable) — via ATO myGov

✅ Step 6: Secure Pre-Approval Before You Inspect

Home loan pre-approval Melbourne buyers obtain before starting property inspections is a critical step that most buyers skip to their detriment. Pre-approval:

• Gives you a firm budget before you fall in love with a property you cannot afford

• Strengthens your position when making an offer or bidding at auction

• Identifies lender concerns early — before you are under a time-pressured contract

• Demonstrates to vendors that your offer is credible and financeable

Pre-approval should be obtained through a broker who has already matched your deposit, income, and credit profile to the most appropriate lender — not from a bank's online calculator, which carries no commitment from the lender.

Ready to Start? Work With a Melbourne First Home Buyer Specialist

Going through this checklist on your own takes time and leaves room for error. Working with a specialist means your deposit strategy, grant eligibility, lender selection, and pre-approval are all handled together — as a structured plan, not a series of separate guesses.

Clarity Financial Solutions offers a free, no-obligation first home buyer strategy session for Melbourne buyers. Preeti Sidhu is a CPA-qualified mortgage broker who compares loans across 40+ lenders and provides structured guidance from deposit planning through to settlement. Book your session via the first home buyer mortgage broker Melbourne page. No fees to you — the service is lender-funded and fully transparent.

Clarity Financial Solutions | 0429 533 236 | info@clarityfs.com.au | ACL 475676