How much can I borrow?
We’re all unique when it comes to our finances and borrowing needs. Contact us today, we can help with calculations based on your circumstances
How do I choose a loan that’s right for me?
Our guides to loan types and features will help you learn about the main options available. There are hundreds of different home loans available, so talk to us today.
How much do I need for a deposit?
Between 5% – 20% of the value of a property, some of which you pay when signing a Contract of Sale. Speak with us to discuss your options for a deposit. You may be able to borrow against the equity in an existing home or investment property.
What is the First Home Owner Grant and can I get one?
This is a grant available to Australian citizens or permanent residents who wish to buy or build their first home, which will be their principal place of residence within 12 months of settlement. Contact us directly to find out more about eligibility requirements in your state and how much grant money you could receive.
Why invest in property?
Australians are among the most active property investors in the world, with an average of one third of new mortgages being for investors. Most of these investors are ordinary people with ordinary jobs earning ordinary incomes. So, why is property investment so popular?
Capital growth, the increase in value of property over time and the long term average growth rate for Australian residential property is about 9% a year. Because property markets move in cycles, property values go through periods of stagnation as well as decline. For this reason taking an investment view of at least 10 years is important. Note: if your investment property increases by 7.5% a year, over a 10 year period it will double in value.
Rental income, also known as yield, is the rent an investment property generates. (You can calculate this by dividing the annual rent by the price paid for the property and multiplying it by 100 to produce a percentage figure.) As a general rule, more expensive properties produce lower yields than moderately priced properties.
Tax benefits, the Federal Government allows you to offset against your taxable income any losses you incur from owning an investment property. For example, if the amount you receive in rent from tenants is $5,000 less than the cost of servicing the mortgage, and paying rates, water and other fees associated with the property, at the end of the year you can add that $5,000 to the amount of income on which you don’t have to pay tax. If you work as an employee, this means you’ll receive a refund from the Australian Taxation Office (ATO) after the end of the financial year.
Low volatility, property values generally fluctuate less than the stock market. Many investors say this gives them greater peace of mind.
You don’t need a big salary to invest. If you are buying to invest, lenders will take rental income as well as your own income into their assessment. If you already own your own home and have some equity in it, you may be able to use this as a deposit, meaning that you can buy an investment property without having to find any additional cash. If you don’t own your own home and feel you may never be able to afford one, buying an investment property may be a good stepping stone to one day being able to afford your own home.
What fees/costs should I budget for?
There are a number of fees and costs involved when buying a property. To help avoid any surprises, the list below sets out many of the usual costs:
Stamp duty — This is the big one. All other costs are relatively small by comparison. Stamp duty rates vary between state and territory governments and also depend on the value of the property you buy. You may also have to pay stamp duty on the mortgage itself. To estimate your possible stamp duty charge, visit our Stamp Duty Calculator.
Legal/conveyancing fees — Generally around $1,000 – $1500, these fees cover all the legal requirements around your property purchase, including title searches.
Building inspection — This should be carried out by a qualified expert, such as a structural engineer, before you purchase the property. Your Contract of Sale should be subject to the building inspection, so if there are any structural problems you have the option to withdraw from the purchase without any significant financial penalties. A building inspection and report can cost up to $1,000, depending on the size of the property. Your conveyancer will usually arrange this inspection, and you will usually pay for it as part of their total invoice at settlement (in addition to the conveyancing fees).
Pest inspection — Also to be carried out before purchase to ensure the property is free of problems, such as white ants. Your Contract of Sale should be subject to the pest inspection, so if any unwanted crawlies are found you may have the option to withdraw from the purchase without any significant financial penalties. Allow up to $500 depending on the size of the property. Your real estate agent or conveyancer may arrange this inspection, and you will usually pay for it as part of their total invoice at settlement (in addition to the conveyancing fees).
Lender costs — Most lenders charge establishment fees to help cover the costs of their own valuation as well as administration fees. We will let you know what your lender charges but allow about $600 to $800. In most cases, this is added to your loan amount.
Moving costs — Don’t forget to factor in the cost of a removalist if you plan on using one.
Mortgage Insurance costs — If you borrow more than 80% of the purchase price of the property, you’ll also need to pay Lender Mortgage Insurance. This is generally added to your loan amount. You may also consider whether to take out Mortgage Protection Insurance.
Ongoing costs — You will need to include council and water rates along with regular loan repayments. It is important to also consider building and contents insurance. Your lender will require at a minimum the building to be insured to complete the loan.
Strata fess — If you buy a strata title, regular strata fees are payable.
How much will regular repayments be?
Go to our Repayment Calculator for an estimate. Because there so many different loan products, some with lower introductory rates, talk to us today about the deals currently available, we’ll work with you to find a loan set-up that’s right for you.
How often do I make home loan repayments — weekly, fortnightly or monthly?
Most lenders offer flexible repayment options to suit your pay cycle. Aim for weekly or fortnightly repayments, instead of monthly, as you will make more payments in a year, which will shave dollars and time off your loan.