Rebuilding your life after a relationship break-up is tough enough without adding in the stress that comes with buying a house.
Securing a deposit, finding the right house and keeping on top of the paperwork involved – on one income and without the moral support of a partner – can be confronting and exhausting.
Yet it’s a challenge thousands of Australians are facing each year. Australian Bureau of Statistics
figures show that in 2016, more than 3100 divorces were granted in South Australia alone. More often than not, one partner will keep the current family home with the other left trying to re-enter a daunting property market.
And, financially, it can often be even tougher for women. Research from the Australian Institute of Family Studies
shows it can take at least six years – and often longer – for a woman’s household income to recover after divorce.
HomeStart Finance client Carol-Ann Payne was 47 when her marriage broke down three years ago.
“I reached the point where I had almost given up hope of that 'dream' of owning my own house again, after having lost my matrimonial home to divorce and life’s rollercoaster of events,” she says.
Through persistent saving, the Murray Bridge grandmother secured a deposit and made the call to HomeStart, who helped her buy a two-bedroom home.
“I really had to think about what I wanted and needed, in the end I just wanted a humble two bedroom abode and HomeStart helped me achieve this,” Carol-Ann says.
If you’re newly single, here’s some tips to help you get into your own home sooner.
Take a breather
We know you want to get back on your feet as soon as possible – and delaying things can seem counterproductive. But moving on too quickly can hurt you in the long-run. Consider taking on a short-term rental to give yourself a breather. This will help make sure the stress of a divorce doesn’t distort the buying process. A six-month lease, for example, can allow you some time to adjust to your new life and let the dust settle on your post-divorce finances. Think about the income you’re bringing in and your ongoing costs.
If you’re considering moving to a new area, renting in the interim will give you a feel for what the neighbourhood’s like without committing.
Look at home loans which require lower deposits
Look for loans that reduce upfront costs and boost borrowing power. Depending on your circumstance, a deposit with HomeStart can start at as little as three per cent
. Unlike most mainstream lenders, HomeStart doesn’t require Lenders Mortgage Insurance. Instead, they have something called a Loan Provision Charge (LPC), which is usually a lot cheaper than Lenders Mortgage Insurance and could save you thousands of dollars.
For eligible borrowers, their Wyatt Loan
can help cover start-up costs of up to $10,000, while the Advantage Loan
could allow you to boost your borrowing power by up to $45,000.
Research, research and more research
Broaden your search criteria by considering different types of dwellings – not just houses. Do the same with locations – look into suburbs you may have previously overlooked. Ask yourself how close you want to be to your ex. If your children are still at home, you may need to consider school zones and other commitments based around them. Look at both your short and long-term needs. If you expect teenage or adult children to move out sometime in the near future, keep this in mind too.
Think about the ongoing maintenance a property may need, including how much work the garden requires. Be realistic about what you’re prepared to spend – and the sorts of tasks you can do yourself. Living alone could also mean that security is now more of a concern for you. If this is the case, factor this into your search and budget.
Breaking up is hard to do. There’s no two ways about it. But divorce shouldn’t mean the end of your home ownership dream. Take a leaf out of Carol-Ann’s book and give HomeStart a call!