FREQUENTLY ASKED QUESTIONS

Q: HOW MUCH MONEY DO I NEED TO CONTRIBUTE TO BUY MY FIRST HOME?

The amount you need to contribute depends on a number of factors. The amount varies according to:

The type of loan you are taking out

The amount you are borrowing

The lender's policy

Q: WHAT ARE DEPOSIT BONDS?

A: A deposit bond is an alternative substitute to all or part of a cash deposit. The deposit bond acts as an insurance policy that guarantees the vendor that the deposit will be paid in full at settlement. They are issued by insurance companies for a modest fee. At settlement, the purchaser is required to pay the full purchase price including the deposit. Please contact us to help you determine if a deposit bond will be required for your scenario, and we can advise on the costs involved.

Q: HOW MUCH CAN I BORROW?

A: Factors such as the size of your income and the deposit amount you have are taken into consideration when determining how much you can borrow. Many lenders require a maximum of 90 per cent Loan to Valuation Ratio (LVR). This means that you can borrow up to 90 percent of the purchase price of the property. However, you will have to supply evidence of your ability to save at least 3 to 5 per cent of the value of the property ('genuine savings'). There are some lenders that will lend at higher ratios depending on the circumstances. 

Q: DOES MY CREDIT RATING AFFECT MY BORROWING ABILITY?

A: The loan process involves checking your credit report. Securing a loan may become more difficult if you haven't paid your bills, skipped payments, or exceeded credit card limits. Contact us for assistance in accessing your credit history; we might be able to help you improve your credit rating before you apply for a loan.

Q: HOW DO I KNOW WHICH TYPE OF MORTGAGE IS BEST FOR ME?

A: Figuring out which type of mortgage best fits your situation and needs may seem initially daunting. However, we can work with you to find the ideal solution for your specific circumstances. There are a number of factors to consider when making this decision. These factors include:

Your current financial situation

Your goals

How long you intend to keep your house.