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Mortgage FAQ's

People often have many questions when they are first considering taking out a mortgage. Here are some of the most frequently asked questions about
mortgages, with answers that will help make an informed decision.
Perchance your question isn't listed here, feel free to call us on
02 8861 1689 or email d.fleming@equityresource.com.au

A mortgage broker is an individual or firm who arranges loans with lenders, usually on behalf of borrowers who want to purchase real property assets or refinance existing mortgages.

Experienced, well-established mortgage brokers typically are accredited with a wide range of lenders that will cover most of the lenders available in their marketplace. This helps borrowers efficiently and quickly compare rates and terms to find the best possible deal. Mortgage brokers work with banks, credit unions, and other financial institutions to find the loan that best suits the buyer’s needs.

They help to shop around for the best interest rates and terms, and they work with the buyer to complete the mortgage application process all the way through to settlement and beyond.

In many cases, a mortgage broker may even be able to negotiate lower interest rates or fees on behalf of a borrower, other than the borrower could get themselves.

In exchange for their services, mortgage brokers receive a commission from the lender selected by the customer, which is typically a percentage of the loan amount. In other words their services don’t cost the borrower anything in the way of extra fees.

For potential homebuyers, property investors and mortgage refinancers, working with a mortgage broker can be a great way to save money and secure the best loan terms possible.

There are plenty of reasons to use a mortgage broker when you’re looking for a home loan.

  • -A mortgage broker can save you time by doing the legwork in researching loans and comparing interest rates.
  • -A mortgage broker can save you money by finding the best loan for your circumstances and negotiating with lenders on your behalf.
  • -A mortgage broker can help reduce stress by guiding you through the loan process and handling paperwork and communication with lenders.
  • -Mortgage brokers have access to a wide range of loans from different lenders, so they can find the best deal for you.
  • -Mortgage brokers are experts in home loans and understand all the ins and outs of the process, so they can help make it as easy as possible for you.
  • -Should you find yourself in a difficult situation where you’ve some lenders aren’t interested in you, a mortgage broker may be able to help. With their experience, they can find lenders that might be willing to work with you. This could give you the opportunity to get the financing you need.

In a nutshell; mortgage brokers save you time and money when shopping for a home loan. By doing the legwork to research loans and compare interest rates, they can help you find the best deal possible.

And, because they have access to a wide range of loans from different lenders, they can also negotiate on your behalf to get you the best terms possible.

But more importantly, mortgage brokers are experts in the home loan process. They understand all the ins and outs and can help you navigate the often-complex process of applying for a loan.

So if you’re looking for a home loan, or refinance an existing one, be sure to talk to a mortgage broker.

A mortgage broker is a professional who helps people get loans from banks or other lending institutions. Mortgage brokers work with borrowers throughout the loan process, from application to settlement and beyond.

Additionally, mortgage brokers will often be able to get exclusive products with lenders, that might not be available if you go directly to the bank. Working with a mortgage broker is a great way to make sure that you are getting the best possible deal on your home loan.

If you’re thinking of buying a home or refinancing, working with a mortgage broker is a great way to make sure that you get the best possible deal on your home loan.

When you go to meet with a mortgage broker, they will ask you questions about your financial situation. Be prepared to answer questions about your income, debts, and assets. The mortgage broker will use this information to determine which lenders meet your individual needs and that you qualify for.

Once the mortgage broker has found some lenders that are suitable for your requirements, they will present these options to you. It is important to compare the different offers before making a decision. The mortgage broker can help you understand the terms of each offer and what it means for your financial future.

Remember, you are not obligated to take the first offer that is presented to you. You can shop around and compare different offers before making a final decision. A mortgage broker can help make this process easier and less stressful.

Mortgage brokers are knowledgeable about the different types of loans available and can help you compare different offers from lenders. When you work with a mortgage broker, you can be sure that you are getting the best possible deal on your home loan.

A mortgage is a loan that a bank or mortgage lender gives you to help finance the purchase of a house. It is usually a long-term loan, with terms ranging from 10 to 30 years. The interest rate on a mortgage is typically lower than the interest rate on other types of loans, such as credit cards or personal loans.

A mortgage is also a way for you to build equity in your home over time. As you make your mortgage payments, the balance of your loan decreases and the equity in your home increases. You can use this equity to get a home equity loan or line of credit, which can be used for home improvements, debt consolidation, or other purposes.

If you’re thinking about getting a mortgage, you can learn more through our FAQ’s, or speak to a helpful broker 02 8861 1689

Mortgage brokers in Australia are paid in a few different ways. Most commonly, they are paid by the lender through what’s called an upfront commission and then ongoing, a trail commission. This is a percentage of the loan amount that’s paid to the broker upfront, and then ongoing at regular intervals (usually monthly) for the life of the loan.

Finally, occasionally some brokers charge their own fees directly to the borrower. These fees are usually the exception to the rule though and can vary depending on the services provided and the complexity of the loan. Mortgage brokers are required to disclose how they will be paid before entering into an agreement with a borrower.

This is a question that many people will ask when they are considering buying a home. Mortgage brokers can save you a lot of money on your home loan.

They play an important role in the Australian lending industry, acting as intermediaries between borrowers and lenders. Brokers are able to provide borrowers with a wide range of options from an infinite number of lenders, and can help to negotiate favourable loan terms. Most mortgage brokers do not charge a fee for their services, although some can when it comes to more complex loan structures.

The answer to this question depends on a few factors, including the type of broker you use and the services they provide. Generally speaking, a mortgage broker will not charge a fee for their services for most main stream residential loans. Because, the lender you finally select will pay the broker a commission.

While their services are free of charge to consumers, mortgage brokers are paid a commission by the lender when a loan is approved and eventually settled. The average mortgage broker commission is 0.6% upfront (after settlement) of the loan amount, then monthly trail commissions typically range from 0.010% to 0.020% on the current balance while the loan is still under the care of that broker.

When you take out a mortgage, your monthly repayments will depend on the size of the loan and the interest rate. The repayment period also affects your monthly repayments, with shorter periods leading to higher repayments. However, you can use a mortgage repayment calculator to estimate your monthly principal and interest repayments based on these factors.

Interest Only repayments Calculator Click Here

To calculate your mortgage repayments, simply enter the loan amount, interest rate, and repayment period into the calculator. The calculator will then give you an estimate of your monthly repayments. You can also use this tool to compare different mortgage products and find the one that best suits your needs. So, if you’re wondering what your mortgage repayments will be, a mortgage repayment calculator is a great place to start.

This is a common question that people ask when they are considering purchasing a home. The answer to this question depends on a number of factors, including your income, your debts, and the value of the property you are interested in purchasing.

In general, you will need to provide proof of income and assets, as well as an assessment of your debt-to-income ratio. Your debt-to-income ratio is one of the key factors lenders use to determine how much they’re willing to lend you.

Generally speaking, the higher your income and the lower your debts, the more you’ll be able to borrow.

However, your credit score will be factored into the equation, as a higher score typically indicates that you’re a lower-risk borrower. Based on this information, your lender will be able to provide you with an estimate of how much you can borrow.

Borrowing Capacity Calculator

It is important to remember that the above link will only give you an estimate, and the final decision will be made by the lender based on their own criteria. Ultimately, the best way to find out how much you can borrow for your particular situation is to contact your mortgage broker or bank

Finally, you’ll need to have enough money left over each month to cover your other expenses. So when you’re figuring out how much to borrow for a mortgage, be sure to take all of these factors into account.

How much deposit do you need for a house? When you start looking at houses, one of the first things you need to consider is how much of a deposit you’ll need. It’s a common question asked by first home buyers. While there’s no definitive answer, as it can vary depending on the lender and the property price. Buying a house is a huge financial commitment, and saving for a deposit can be difficult.

However, it’s important to remember that the larger the deposit, the lower the monthly mortgage repayments will be. When you’re trying to save up for a house deposit, it can be helpful to have a target in mind. Usually, 20% of the full value of the property is a good amount to aim for. That way, getting approved for a loan will be that much easier.

Also, if you can put down a larger deposit, you’ll save money in the long run and be able to pay off your loan more quickly. Of course, this isn’t always possible – and you can still get a loan with a smaller deposit. Nonetheless, you may need to take out Lenders Mortgage Insurance (LMI) if your deposit is less than 20%. This adds an additional cost to your loan, and it’ll also take longer to pay off.

So if you can, aim to save up at least 20% of the value of the property before you start looking for a loan. Ultimately, the size of your deposit will affect both the cost of your loan and the amount.

That said, many first home buyers may be eligible for Government concessions that remove that remove the need to pay LMI even though they don’t have a 20% deposit. Contact your mortgage broker who will be able to give you the details you need (T’s & C’s apply).

A loan pre-approval means that a lender has agreed, in principle, to lend you an amount of money towards the purchase of your home but hasn’t proceeded to a full or final approval.

If you’re looking to purchase a house but you’re not sure how much you can spend, it’s difficult to know where to begin. You might find a property that seems perfect, but have no idea whether it’s a realistic option for your budget.

If a lender pre-approves you for a loan, they will do so for a specific amount, so you can focus your house hunting on the properties you can afford. It also means that, if you’re bidding at an auction, you’ll have a maximum bid in mind.

A pre-approval is a valuable step in getting you closer to your new family home or investment property. It’s not a requirement in the home buying process, but it can make life easier and the final processing of your loan that much faster (less stress).

When you’re ready to buy a home, one of the first steps you’ll take is applying for a mortgage. Lenders will assess your financial situation and give you a pre-approval letter if they think you’re a good candidate for a loan. This letter indicates how much money you’re eligible to borrow and gives you an advantage when it comes time to make an offer on a house.

Occasionally a home buyer will believe that obtaining a pre-approval letter from a lender is all they need to do in order to guarantee finance for their new home. However, this is not always the case.

While pre-approval is an important step in the home-buying process, it is not a guarantee that you will ultimately receive a loan. A number of factors, including your employment history, debt liability changes, credit score, and debt-to-income ratio, can impact your loan eligibility.

Additionally, the lender may re-evaluate your qualifications based on changes in market conditions, such as Government regulation changes or a negative valuation on the selected property. As a result, it is important to stay in close communication with your broker or lender throughout the process to ensure that you are still on track to receive financing.

While there is always some degree of uncertainty when applying for a loan, having pre-approval will give you a much better chance of successfully securing financing for your new home.

Once you have been pre-approved for a mortgage, the next step is to find a property that meets your needs and budget. Once you have found a suitable property, you provide the lender with a (Vendor) signed Contract of Sale.

From there, your lender will review your application details to confirm there have been no changes to your financial position. Then, they order a valuation to assess the value of the property. If everything checks out and the valuation comes back at, or better than the contract purchase price they will grant you unconditional approval and provide you with a loan offer agreement.

However, if the lender’s credit assessor finds any red flags, then they may require additional documentation or even deny your loan. As a result, it is important, to be honest, and upfront with your lender during the pre-approval process.

The loan offer will outline the terms and conditions of the loan, including the interest rate, repayment period, and any fees and charges.

You will then need to decide whether to accept the loan offer. If you accept the loan offer, you will sign the loan offer and you can go ahead and pay the agreed-upon deposit to the Vendor.

One of the big benefits of a loan pre-approval is the amount of time it saves, versus starting from scratch. After signing a property contract of sale most purchasers are then under the gun to exchange contracts before a 5 day cooling-off period expires.

If it’s an auction, there is no 5-day cooling-off regulatory clause and you will be required to pay the agreed deposit on the spot.

At the exchange of contracts, once you pay the agreed-upon deposit, it now becomes nonrefundable, regardless of whether or not you get your finance approved.

In other words, if you fail to proceed to settle on the property, you will lose your deposit.

The deposit will usually be equal to 5-10% of the purchase price of the property. Once this has been paid, the lender’s settlement department will arrange with your Conveyancer/Solicitor to confirm a settlement date with the Vendor’s Solicitor and for the remaining funds to be paid to the Vendor on that agreed-upon date.

From there it’s, ‘Home Sweet Home’, you can move in.

 

 

When you’re shopping for a new home, one of the first things you’ll need to do is get pre-approved for a mortgage. This will give you an idea of how much money you can borrow and what your monthly payments will be. But how long does a mortgage pre-approval last?

In general, a mortgage pre-approval is good for anywhere from 90 to 180 days, depending on which lender you have chosen. That said, most lenders allow just the 90 days. This should give you enough time to shop around for the perfect home without having to worry about your financing falling through.

However, it’s important to keep in mind that your pre-approval is not set in stone. If interest rates go up or your financial situation changes, your pre-approval may no longer be valid.

This is because lenders pull your credit report periodically to check for changes, and your credit score could drop if you’ve opened new lines of credit or made any late payments since you were first pre-approved.

Also, home prices could have increased in the meantime, meaning you might not be able to afford the same house you were originally pre-approved for. If you’re still interested in buying a home after your pre-approval expires, simply contact your broker/lender and start the process over again.

It’s a common question asked by homebuyers: does pre-approval hurt your credit score? The simple answer is no – pre-approval does not have any negative impact on your credit score. In fact, many experts recommend getting pre-approved for a mortgage before shopping for homes.

There are several reasons for this. First, getting pre-approved will give you a better idea of how much house you can afford. Second, pre-approval can streamline the homebuying process and help you move more quickly once you find the right property.

Finally, sellers are often more willing to accept offers from buyers who have already been pre-approved by a lender. So if you’re thinking about buying a home, don’t be concerned about affecting your credit score.

When you apply for a mortgage, your lender will pull your credit report and score to assess your creditworthiness. This is called a hard inquiry and can slightly lower your credit score. However, hard inquiries only remain on your report for 12 months, and their impact diminishes over time.

So, if you’re wondering whether going through the pre-approval process will hurt your credit score, the answer is no – as long as you don’t apply for too many different loans at once.

When you are buying a home, the loan process can be confusing. One term you may hear is “conditional approval.”

But what does that mean?

Conditional approval is when a lender has approved your loan subject to certain conditions. These conditions may include things like providing more documentation for verifying your income or getting a property valuation. Once you have met all the conditions, the loan will be fully unconditionally approved and you can move forward with buying your home.

While conditional approval may seem like a hassle, it’s actually a good sign that the lender is interested in working with you. So if you hear that your loan has been conditionally approved, don’t worry! It’s just a standard part of the process, and as long as you meet the conditions, you’ll be on your way to owning your new home in no time.

That said, in some cases, meeting the conditions for conditional approval can take some time, so it’s important to start the process as early as possible.

A mortgage unconditional approval means that your loan has been approved and you are able to settle the purchase on your home. This type of approval is the most definitive and gives you the greatest certainty that you will be able to settle on your loan.

With unconditional approval, you have a firm commitment from the lender that they will provide you with the funds necessary to purchase your home.

In some situations, there may be a few outstanding conditions that must still be met before the loan can be funded. These conditions are usually only minor undertakings and the applicant should be able to resolve any outstanding issues easily.

Don’t be too concerned, because in most cases these extra conditions are more the exception rather than the rule. Once those conditions are met, you will be able to settle on your loan and officially become a homeowner.

After you have been unconditionally approved for a home loan, there are a few things that will happen. First, the lender will send you a loan offer agreement, which will include all of the terms and conditions of the loan.

This document will include the details of the interest rate, repayment schedule, and any fees and charges.

You will then have a certain amount of time to review the loan offer and decide whether or not to accept it. If you accept the loan offer, you will be required to sign a few documents and may be asked to provide additional information.

Once everything has been finalized, the lender will communicate and coordinate a settlement with all parties involved and book a date for the settlement of your loan.