Did You Know?

Your Ultimate GPS for the Financial Journey!

Seeking a home loan could sound as a simple straightforward process. However, it could turn out to be a nightmare if it is not handled with care. It’s typical solution seeking exercise that requires problem solving approach supported right analytical skills and knowledge of latest credit environment. We deal with more than forty different lenders. Each provide range of products, with varying features and benefits, suitable to their own focused segments. Selecting a right lender and loan type therefore becomes a cutting-edge activity.

Like most things in financial services, the grey areas can make or break good advice and the terms ‘reasonable’ and ‘relevant’ can be open to interpretation.

As loan expert we assess each situation in context, give it specific consideration and ensure it reflects (and is supported by) our data, documents and understanding. Our well-developed professional judgement is key to successfully understand your needs, analyse information, build scenarios, apply key considerations to evaluate the options and present you in manner that leads you to unique executable strategy.

Practically, if your client file is incomplete, then it makes it difficult (and sometimes impossible) to understand your intent and reasoning and assess the appropriateness of your advice. 

A properly completed Fact Find helps structure and document your discovery process. After this stage we go on the Credit Analysis and Assessment process. This stage is very similar to decoding a black box that requires fairly creative as well analytical inputs. Once this process is successfully completed, we go on to issuing a Statement of Credit Advice which contains all the background information and our recommendations. They also include relevant details of our renumerations and our obligations as licensed Accredited Credit representative.Broadly speaking there are different categories of home loans that can be defined in following ways. Each of these segments require different approaches

Home loan PROCESS

13 steps to follow

Every home buying goes through a process. The steps are:

Figure out what you can afford

Save or build your deposit

Choose your provider and Obtain pre-approval

Appoint conveyancer

Research your property / negotiate

Check with your broker for suitability of the security with the lender

Execute the purchase/ contract signing

Modify your approval condition to optimise the exact purchase conditions

Order valuation

Apply and obtain for unconditional approval

Sign loan documents

Proceed to settlement

13. Final Step
Complete the transition

Cost of {Home Loan}

Purchasing home costs more than the price tag mentioned on the contract price that one should be aware of. You can add around 5% to take care of these additional expenses. Some prominent expenses are:

Stamp Duty or Transfer costs

Property transfer stamp duty is a state government tax payable by the buyer and is calculated on the price paid for the property. Because it is a duty for transferring the title of a property, it will be imposed whether or not the purchase is financed with a mortgage. First home buyers may be eligible for significant rebates on stamp duty.

Mortgage Registration fee

This is an administrative charge imposed by the Land Titles Office or equivalent in each state or territory. This fee is charged for entering (registering) the lender’s mortgage on to the title record for the property.

The fee differs from state to state, and ranges from around approximately 150 per registration. The borrower pays this fee.

Application fee

To start the process of obtaining a loan, the borrower may have to pay an application or loan establishment fee. The cost can vary depending on loan type, lender, security and loan splits. In most cases, the fee includes the cost of the first valuation.

The cost of additional valuations ranges from $150 – $250. A few lenders may ask for an upfront payment to cover costs. Many lenders charge these fees on loan disbursement.

Property Valuation fee

Many lenders cover these fees in the application fee. However, some may charge it upfront. These fees

Lender's Mortgage Insurance (LMI)

This fee insures the lender against any loss incurred if the borrower defaults and the net proceeds of an enforced sale of the security property are insufficient to clear the debt. It is important to note that Lender’s Mortgage Insurance covers the lender, not the borrower.

LMI may be added to your final home loan amount (optional) It should not be confused with Mortgage Protection Insurance, which covers the mortgage repayment for the borrower in the event of death, disability, illness or involuntary unemployment etc.

Conveyancing Fees

These are charged by the conveyancer looking after your property transfer and loan settlements. Usually, conveyancers also guide in explaining and negotiate contract terms that can suit you better than originally prescribed. In such cases there may be additional costs.

Purchase Costs

Some of these costs relate to property inspection costs such as pest and building inspection. The cost of inspections is payable by the property buyer. Note that lenders may make satisfactory inspections a condition of loan approval if doubts exist about the condition of the property.

Renovation or construction costs

These costs come into picture if the security to be purchased is to be modified or built new for bringing into suitable occupation condition. Ideally the buyer has to engage a suitable builder to estimate these costs and obtain a fixed price contract to ensure exact picture of the final landed price.

Insurance cost

There are various types of insurances required. Home and contents insurance is mandatory and lenders will insist on such cover prior to settling the loan. Other important covers (but not mandatory) are Mortgage protection, Income protection which help borrower to cover the repayments in the event of injury, illness or death.

Transition costs

These cover post-settlement expenses such as cleaning, removalist, purchase of white goods, renting (in case of investment property) and other miscellaneous transfer costs.

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