FAQ
Frequently asked questions
Mortgage Broker FAQ
It’s difficult to give a rate as interest rates vary from lender to lender and are based on many factors. Your loan to value ratio (LVR which is the amount of loan to the value of your property), many lenders will discount the rate further the lower the LVR. Your loan amount will also factor, lenders may offer larger discounts for higher loans. The range of rates will vary as lenders constantly update their discounts depending on their appetite.
The deposit required can vary but generally ranges from 5% to 20% of the property’s purchase price plus costs. However, some lenders may offer loans with a lower deposit amount under certain conditions.
Typical documents required for a mortgage application include proof of identity (such as a driver’s licence and passport), proof of income (such as payslips or tax returns), bank statements, credit card, loan statements and a contract of sale if you’ve purchased.
Lenders Mortgage Insurance (LMI) is a type of insurance that protects the lender if the borrower defaults on the loan. It’s typically required when the borrower’s deposit is less than 20% of the property’s purchase price. You can find more information here.
This is dependent on how much you have saved for a deposit and what you current expenses are. Give us a call and we can go into your options in more detail, or check out the loan calculator page of our site!
There are many types of home loans, owner -occupied which can be fixed or variable rate and usually paying the principal and interest. Investment loans again can be fixed or variable rate with the option of principal and interest or interest only payments. There are also bridging loans that are a short-term loan allowing you to purchase a property whilst in the process of selling yours.
We are only allowed to recommend a product based on what you say is most important to you – for example, “pay my loan off quickly” or “guaranteed repayments”.
We do however, like to say the following; “if you want flexibility take a variable rate loan, if you want budget certainty take a fixed rate loan, if you want both, then do both.”
Yes, many Australians self-employed or small business owners. You will need to provide tax returns to assess your income.
It may be challenging to get a mortgage with a low credit score, but some lenders specialise in loans for borrowers with lower credit scores. A mortgage broker can help you explore your options.
Depends on the lender service levels, some lenders have slick processes and can turn around a decision in a few hours whilst others may be inundated with applications due to low rate offerings and could take a couple of weeks to process.
What is the difference between fixed-rate and variable-rate mortgages?
A fixed rate locks in the rate for an agreed period of time and will not change during that time. A variable is subject to change for example may move up or down due to cash rate changes that the lender may pass on.
The First Home Owner Grant (FHOG) is a local state or territory incentive aimed at helping first-time homebuyers build. Eligibility criteria vary by state or territory, and your mortgage broker can assist you in determining if you qualify.
Mortgage brokers are professionals in the home loan industry. They work with you to determine your borrowing needs and how much you can borrow. Brokers help to ensure that you don’t take out a loan that is too big for you.
Brokers have access to a wide variety of loans. We help you find the right home loan by acting as an intermediary between you and lenders. This means your broker can find a loan that’s just right for you.
When we talk about a ‘loan product’ we are referring to the thousands of options that are currently available for you for your loan. Each bank (or lender) has loads of different loan options – low doc, package loans, re-draw facilities, plant and equipment loans, fixed, interest only, interested in advance, variable, introductory variable… the issues you face as a consumer is ‘which loan is right for me?’ And that is where a mortgage broker comes in.
If you go direct to the bank, you will only be offered the loan options available through that one lender. As your mortgage broker, we do all the leg work for you. We are across many lenders and all of their loan products and our sole purpose is to find the right loan for your needs.
Some mortgage brokers charge a fee, but we don’t. If brokers charge a fee for their service, they must disclose this fee upfront to you, so you know what you will be up for if you engage their services.
Absolutely not! There is legislation in our industry, called the National Consumer Credit Protection Act (or NCCP), that is designed to protect consumers and ensure ethical and professional standards in the finance industry. We tell you upfront what commission we will be getting from the bank. Our job, our only job, is to find the best loan for your needs and serviceability.
We are with the leading aggregator in Australia called Connective. This means that we have access to many lenders – these include the major banks, second tier lenders and credit unions. We can source you a loan from the lender of your choice.
When you take out a loan via a Mortgage Broker – it does not cost you more. Brokers get paid commission by the bank for bringing new business to them, this does not impact your rate or level of service. The costs of the loan are the same, depending on the loan you choose.
The Reserve Bank of Australia meet on the first Tuesday every month to determine the ‘official cash rate’ for the country. The lenders then use this information to set their own rates. Mortgage brokers do not set rates.
We are mobile brokers so we can come to you!
