Frequently Asked Questions

What should I know before buying a home?
Which mortgage home loan is best for me ?
What is Lenders Mortgage Insurance (LMI)?
What is LVR ?
What is Introductory or Honeymoon Rate Loans?
How much deposit I need to buy home?
How often I have to make repayments?

What should I know before buying a home?

Here are some tips that could save you a lot of time, money and trouble.

Plan ahead. Establish good credit and save as much as you can for the Deposit and  costs.

Get pre-approved  before you start looking. Not only do real estate agents prefer working with pre-qualified buyers; you’ll have more negotiating power and an edge over homebuyers who are not pre-approved.

Set a budget and stick to it.

Know what you really want in a home. How long will you live there? Is your family growing? What are the schools like? How long is your commute? Consider every angle before diving in.

Make a reasonable offer. To determine a fair value on the home, ask your real estate agent for a comparative market analysis listing all the sales prices of other houses in the neighbourhood.

Choose your loan (and your lender) carefully.

Consult with your lender before paying off debts. You may qualify even with your existing debt, especially if it frees up more cash for a down payment.

Keep your day job. If there’s a career move in your future, make the move after your loan is approved. Lenders tend to favour a stable employment history.

Don’t shift money around. A lender needs to verify all sources of funds. By leaving everything where it is, the process is a lot easier on everyone involved.

Don’t add to your debt. If you increase your debt by financing a new car, boat, furniture or other large purchase, it could prevent you from qualifying.

Timing is everything. If you already own a home, you may need to sell your current home to qualify for a new one. If you’re renting, simply time the move to the end of the lease.

Which home loan is best for me ?

You certainly have a lot of home loans to choose from. Fixed or variable? Principle and interest or Interest only or    Line of credit mortgage facility.

The simple answer is the best mortgage that you can actually get, for your circumstances. The type of the loan depends upon a number of factors like your borrowing power, LVR, interest rates and other features you are  looking for.

Homeloan Consultant will be able to give best picture after going through the details of your requirements. When you consider that are services are free to you it makes sense to apply for your mortgage through Josh Financial Services.

What is Lenders Mortgage Insurance (LMI)?

Lenders Mortgage Insurance (LMI) available to home loan customers, and allows you to borrow more than 80% of the value of your property. It protects Lenders against the risk of loss should you default on your loan. If your property is subsequently sold and the proceeds of the sale are insufficient to fully repay the loan, Lenders are covered for the shortfall. However, LMI does not protect the borrower and you would be liable to repay any shortfall to lender.

This is a once-only premium is paid at the start of the loan, and the amount of the premium is dependent upon the amount of the loan and the value of secured property. The higher the Loan to Valuation Ratio (LVR) borrowed, the higher the premium.

What is LVR?                                                                                                    

LVR  when referred to a mortgage is an abbreviation of Loan to Value Ratio. This is a ratio, expressed as a percentage, of the size of the mortgage loan in dollars required compared to the value of the security. The value that a registered valuer says its worth for the purpose of obtaining a loan from a credit provider.

To calculate the loan to value ratio you divide the loan value by the value of the property, and multiply the result by 100 to obtain the percentage.

We have loans up to 106% of the value of the property depending on your needs circumstances.

What is Introductory or Honeymoon Rate Loans?

These types of loans offer a low interest rate usually for the first 6 months to 12 months of the loan. The rate may be fixed, variable or capped, meaning that if interest rates rise your rate will not go up, but if rates fall that rate will go down and you will benefit. Once the Introductory or Honeymoon period is finished the interest rate usually reverts to the standard variable rate.

The advantage of an Introductory Rate is that it offers borrowers a chance to reduce the principal quickly by making extra repayments. The main disadvantage is that most banks charge penalties if you discharge these types of mortgages within in first 1-4 years after settlement.

How much deposit I need to buy home?

The amount of deposit required depends upon the Home loan product and also the lender. Generally the for owner occupied properties 5% deposit is requited. We also have lenders that provide no deposit 100% home loans meaning no deposit is required. Home Loan manager will provide a more specific overview for your individual situation. Call us to find out more or Click here to submit a loan enquiry

How often I have to make repayments?

Most lenders these days offer flexible regular repayment plans. You can choose to pay weekly, fortnightly or monthly. These repayments can be matched to you pay cycle and can be altered any time. Call us to find out  more or  Click here to submit a loan enquiry