After helping a lot of first home buyers into their homes, we see the same handful of mistakes over and over. None of them make people bad at buying. They just happen when you've never done it before.
Here are the ones that cost the most.
1. Borrowing the maximum
The bank's maximum isn't a recommendation. Lenders test you at a rate about 3% above the actual rate, but they don't know you want a holiday every year, or that you're planning kids next year.
Work out what repayment you're comfortable with, then work backwards to a price.
2. Taking on new debt before settlement
We've seen approvals fall over because someone bought a car on finance between exchange and settlement. Lenders can and do recheck your credit before funding.
Until you've got the keys: no new loans, no new credit cards, no big Buy Now Pay Later purchases.
3. Not getting pre-approval first
Shopping without pre-approval means you don't know your real budget, you can't bid confidently at auction, and you might fall in love with something you can't finance.
4. Missing scheme deadlines and conditions
The 5% Deposit Scheme needs to be arranged through a participating lender. FHSS needs an ATO determination before or within 14 days of signing. Stamp duty concessions need you to move in within 12 months.
Each scheme has fine print. Miss it and you can lose thousands.
5. Choosing a loan on rate alone
The lowest rate isn't always the cheapest loan. Look at:
- Fees (annual, application, settlement)
- Offset account availability
- Ability to make extra repayments
- How the lender treats existing customers over time
The comparison rate helps capture fees, but a good offset account can be worth more than a slightly lower rate.
6. Skipping the building and pest inspection
A $600 inspection can uncover a $40,000 problem. If you're buying at auction, do it before auction day. If you're buying a unit, get the strata report too.
7. Bidding over the stamp duty threshold
In NSW, first home buyers pay no stamp duty up to $800,000. Above that, duty starts to apply. Going from $795,000 to $810,000 costs you the extra $15,000 plus a chunk of duty. Know your numbers before auction day.
8. Not keeping a buffer
Many first home buyers put every dollar into the deposit. Then the hot water system dies in month two.
Keep at least one to three months of repayments aside, ideally in an offset account where it reduces your interest anyway.
9. Setting and forgetting the loan
Lenders often give their best rates to new customers. Two or three years after settlement, many borrowers are paying noticeably more than new customers on the same product.
Review your loan every year. If your bank won't match a better offer, consider refinancing. As brokers, this is one of the most valuable things we do after settlement.
Bonus: not asking questions
There's no such thing as a silly question when you're borrowing hundreds of thousands of dollars. If something in your loan documents or contract doesn't make sense, ask.
Frequently asked questions
How much buffer should I have after buying?
Ideally one to three months of repayments plus a small emergency fund for repairs.
Can I change lenders after I buy?
Yes. Refinancing is common, though it costs some time and fees. If you're on a fixed rate, check for break costs.
Do brokers charge first home buyers?
Usually not. Most brokers, including Finfident, are paid by the lender when your loan settles.
Want someone to help you avoid these mistakes? Call Finfident on 0424 545 654. We'll guide you from pre-approval to settlement and keep an eye on your rate after you move in.
This article is general information only and doesn't take into account your objectives, financial situation or needs. Figures, rates and scheme rules are current as at October 2026 and can change. Finfident Finance Brokers (ABN 94 679 280 801) is Credit Representative 569374 of Outsource Financial Pty Ltd (ACN 131 090 705), Australian Credit Licence 384324.