Step-by-Step: How to Set Up Your Home Loan in Australia (2026 Guide)
Buying a home is one of the biggest financial decisions you’ll ever make and for many first home buyers, the home loan process can feel confusing, overwhelming and full of jargon.
The good news? When you break it down into clear steps, getting a home loan in Australia in 2026 is far more manageable than you might think, especially when working with an experienced Mortgage Broker in Perth who understands the local market.
Here’s a simple, step-by-step guide to help first home buyers understand the home loan journey from planning to settlement.
Step 1: Understand Your Financial Position
Before applying for a home loan, it’s important for every first home buyer to understand where they stand financially. Lenders will assess:
Your income and employment stability
Your living expenses
Existing debts (credit cards, car loans, HECS/HELP)
Your credit history
Your savings and deposit size
This is where many first home buyers go wrong, guessing instead of checking.
As a Mortgage Broker in Perth, I assess your position across multiple lenders so you know your real options upfront, not just what one bank is willing to offer.
Step 2: Work Out How Much You Can Borrow
Your borrowing power isn’t just about income, it’s about how lenders view your overall risk.
In 2026, borrowing capacity can vary significantly between lenders due to:
Different serviceability models
How overtime, bonuses, or self-employed income are treated
Living expense assumptions
Knowing your borrowing limit early helps first home buyers in Perth to:
Set a realistic property budget
Avoid disappointment
Narrow your property search
This is one of the biggest advantages of using your local Mortgage Broker in Perth rather than going direct to a single lender.
Step 3: Save Your Deposit (and Explore First Home Buyer Options)
Traditionally, buyers aimed for a 20% deposit, but many first home buyers are purchasing with less.
Depending on eligibility, you may be able to buy with:
5% deposit (First Home Guarantee Scheme)
10% deposit with select lenders who offer a Lenders Mortgage Insurance (LMI) for professionals
A higher deposit to avoid Lenders Mortgage Insurance (LMI)
You’ll also need to budget for:
Stamp Duty
Conveyancing and legal fees
Building and pest inspections
Moving costs
A Mortgage Broker in Perth can help first home buyers understand which low-deposit options are realistic and which lenders are best suited to their situation.
Step 4: Check First Home Buyer Grants and Government Support
In 2026, first home buyers in Australia may be eligible for:
First Home Owner Grant (FHOG)
Stamp duty concessions or exemptions
First Home Guarantee Scheme (5% deposit without LMI)
Each state and territory, including Western Australia, has different rules, price caps and eligibility requirements.
A quick eligibility check with a local Mortgage Broker before you buy can potentially save first home buyers thousands of dollars.
Step 5: Get Pre-Approval or a Letter of Eligibility (LOE)
Pre-approval or a Letter of Eligibility (LOE) is one of the most important steps for first home buyers entering the property market as it:
Confirms how much you can borrow
Shows sellers and agents you’re serious
Allows you to act quickly in competitive Perth home buyer markets
While pre-approval or a LOE isn’t a final guarantee, it gives first home buyers confidence and leverage when making offers.
Step 6: Choose the Right Home Loan
For first home buyers, interest rates matter, but they’re not everything.
In 2026, home loan features to consider include:
Fixed vs variable interest rates
Offset accounts to reduce interest
Redraw facilities for flexibility
Loan structures that suit future plans
A knowledgeable Mortgage Broker in Perth can help first home buyers compare options and choose a loan and structure that can potentially save tens of thousands of dollars over time.
Step 7: Make an Offer and Move to Full Approval
Once you’ve found the right property:
You make an offer
Your mortgage broker orders a valuation on behalf of the lender
Your loan is lodged and assessed
Your loan moves to unconditional approval
Contracts are finalised
This stage can be stressful for first home buyers, but having a Mortgage Broker in Perth coordinating with your lender, agent and conveyancer makes the process far smoother.
Step 8: Settlement and Getting the Keys
Settlement is when ownership officially transfers to you.
Your lender, conveyancer and Mortgage Broker coordinate documents, final checks and funding. Once settlement is complete the keys are yours.
Congratulations - you’re officially a homeowner!
Final Thoughts: A Clear Path for First Home Buyers in 2026
Buying your first home doesn’t have to be complicated.
When guided step by step and supported by an experienced Mortgage Broker in Perth, first home buyers can move forward with confidence.
So as your local Mortgage Broker in Perth, I help my first home buyers to:
Understand your borrowing power
Access first home buyer grants and schemes if required
Secure pre-approval (or a Letter of Eligibility)
Choose the right home loan
Navigate the home loan journey from start to settlement
If you’re a first home buyer in Perth planning to buy in 2026, or just starting to explore your options - now is the perfect time to get clarity.
Get in touch today and let’s create a clear, step-by-step plan to help you buy your first home sooner.
