FAQ

While a 20% deposit is standard, some lenders may accept lower deposits, potentially requiring you to pay Lenders Mortgage Insurance (LMI).

LMI is insurance that protects the lender if a borrower defaults on a loan. It's typically required when your deposit is less than 20% of the property's value.

Yes, you can leverage the equity in your existing property to finance an investment property. Equity is the difference between your property's market value and the outstanding mortgage balance.

• Fixed-Rate Home Loan: The interest rate remains constant for a set period, providing repayment certainty.
• Variable-Rate Home Loan: The interest rate can fluctuate based on market conditions, which may affect repayment amounts.

Choosing between the two depends on your financial situation and risk tolerance.

Lenders typically calculate interest daily based on your outstanding loan balance and charge it monthly. For example, with a $400,000 loan at a 4.5% annual interest rate:

($400,000 x 4.5%) / 365 = $49.31 per day.

Over a 30-day month, this totals approximately $1,479.30 in interest.

Beyond the purchase price, consider expenses such as stamp duty, legal and conveyancing fees, building and pest inspections, and potential LMI if your deposit is below 20%.

Strategies include making extra repayments, increasing repayment frequency, utilizing an offset account, and conducting regular loan reviews to ensure you're receiving a competitive interest rate.

An offset account is a transaction account linked to your home loan. The balance in this account offsets your loan principal, reducing the interest charged. For instance, with a $350,000 loan and $25,000 in your offset account, you'd only be charged interest on $325,000.

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Yes, self-employed individuals can obtain home loans. Lenders typically require proof of income, such as tax returns and financial statements from the past two years. Some may offer low-documentation loans with different criteria.

LVR is the percentage of the property's value that you're borrowing. It's calculated by dividing the loan amount by the property's appraised value. A higher LVR indicates higher risk to the lender and may influence the loan terms or require LMI.