FAQs

No worries. There are other options that you can consider:
1. Ask your bank or lender to lower your interest rate

2. Consider a mortgage top-up

3. Apply for a change in your loan type

These options can also save you money and help you achieve your financial goals in no time.

What is equipment financing?

You can apply for equipment financing when you want to increase your business’ capacity by upgrading your equipment. It is also ideal if you are looking to start a business and need the latest equipment or tools.

Equipment financing also helps businesses manage their cash flow better.

Refinancing happens when you take out a new mortgage to replace your existing loan. If you want to reduce your payment or get a better interest rate, you might want to refinance. Refinancing can also give you access to different features and add-ons like an offset account or flexible payments.
You can also consider a refinance of your home loan if you are experiencing some changes in your lifestyle.

A mortgage broker will take the guesswork out of lending requirements and guide you through the buying process. They will also help you find the right loan based on your needs. Further, mortgage brokers offer tailored loan packages to help reduce your interest rate.

There are several types of home loans you can choose from depending on your situation and needs. However, you can get cheaper home loans when you are borrowing for a home and pay both principal and interest.

Banks or lenders will offer higher interest rates on loans for investment. They can also penalise you for borrowing for investment properties.

Loan Value Ratio (LVR) is the amount you have to borrow to buy a property. You calculate it by dividing the amount of your loan by the bank’s or lender’s valuation of the property.

For example, the property is worth $500,000 and you have a deposit of $100,000. This means you still need to borrow $400,000. Now divide $500,000 by $400,000. Then, get the percentage. Your LVR will be 80%.

A mortgage is a home loan, with interest, from a bank or lender. You use it to buy, build, or renovate a residential property. The borrower must make payments regularly, based on the repayment schedule agreed upon with the lender. A mortgage also accrues interest over the life of your loan.

In Australia, a home loan term typically lasts for 25 to 30 years.

For first time home buyers, you will need to show the banks or lenders your account savings. You must have at least a 5% genuine savings or an increasing savings over a 3-month period. This will give you a maximum borrowing of 95%. However, you must make sure the account savings is in your own name.

Then, find an expert. Buying a home can be stressful and time consuming if you don’t have the expertise. An expert mortgage broker will also walk you through the loan application and paperwork, which includes:

• Evidence of your income – recent bank statements, payslip, and spending and saving history
• Your current assets and liabilities–details of your personal and car loans, investments, credit card debts, etc.
• Your household and living expenses–summary of your daily budget
• Personal IDs–birth certificate, driver’s license, passport or citizenship certificate

Lenders Mortgage Insurance (LMI) is an insurance a bank or lender takes against your loan. LMI protects banks and lenders from financial loss if you can’t meet your loan payments.

LMI allows you to get a home loan even if you don’t meet the bank’s or lender’s financial requirements. You calculate it based on your loan amount and could go from 1% up to 4%.

You pay for the LMI if you borrow over 80% of the value of your property. Hence, you must remember not to borrow higher than 80%.