Question 1

Why should I use a Mortgage Broker?

Accepted Answer

A Mortgge Broker will consider loans from a range of lenders and find you a product that best suits your circumstances.  As a mortgage broker, I act in your best interests when recommending a home loan, whereas a lender has no legal obligation to do so

Question 2

What other services does a Mortgage Broker provide?

Accepted Answer

Along with Home and Business loans, Moving Forward Finance can also provide access to other services such as house and contents insurance, compare our offerings before you commit to other providers.

Question 3

How does a Broker get paid?

Accepted Answer

Our fee's or commissions are usually paid by the lender whose products we recommend.  The difference between commission paid on products is marginal and consumers should not be concerned that this commission will impact the quality of advice you are given.  As a mortgage broker.  As a mortgage broker, I have a legal obligation to act in your best interests when making a credit recommendation

Question 4

What role does a Mortgage Broker Fulfill?

Accepted Answer

Based on knowledge of your unique circumstances, Moving forward Finance will source an appropriate loan for you and act as a liaison between yourself and the lender.  When it comes to submitting a loan application, we will do the legwork for you and ensure your loan is processed as quickly as possible.  As a mortgage broker, I act for you; a lender sells you products

Question 5

How much deposit do I need for a home loan?

Accepted Answer

Traditionally you need at least a 20% deposit to get a home loan.  Moving Forward Finance has access to lenders that will allow a deposit from as low as a 5% deposit (plus upfront fees) with the use of products such as lenders mortgage insurance.  If you don’t have a 20 per cent deposit, you will generally be required to pay for lenders mortgage insurance (LMI). Lenders mortgage insurance provides protection to the lending institution in the event that you default on your home loan. it is a one-off charge that gets included in your loan amount or is required to be paid upfront.A guarantor can also volunteer their home equity as security for your loan. In the event that you default on your loan, your guarantor would wear the responsibility of paying off the loan.
The amount you need to save is dependent on the loan to value ration (LVR).  LVR is the loan amount divided by the value of the property.  For example, if you're looking at a property with a purchase price of $200,000 and have a deposit of $20,000 your LVR is 90% ($180k / $200k).

Question 6

What is stamp duty?

Accepted Answer

Stamp duty is a charge which is applied by state governments in Australia  on transactions relating to the transfer of land or property. It is paid upfront and needs to be budgeted for in addition to your loan deposit. The amount of stamp duty you are required to pay differs in each state.  Check out our hand stamp duty calculator to see how much this would be for the property you are looking at.

Question 7

What's a simple way to increase my borrowing capacity?

Accepted Answer

The key to increasing your borrowing capacity is to reduce your debt.  One of the easiest ways to achieve this is to lower your credit card balance, reducing the perceived risk to lenders.  Another was is to look for opportunities to increase your income.

Question 8

What is negative gearing?

Accepted Answer

If you earn less from an investment property than it’s costing you, you’re said to be negatively geared. The motivation to be negatively geared is that it reduces your taxable income and you accept a short-term loss in the hope of a capital gain later.

Question 9

What's the difference between an investment loan and a home loan?

Accepted Answer

Unlike a home loan, costs associated with an investment loan are tax deductible (eg interest, repairs, rates, depreciation, etc). However, be aware that any rental income will generally increase your taxable income. Another key difference is that any appreciation in the value of an investment property (capital gains) is taxed.

Question 10

What is refinancing?

Accepted Answer

Refinancing is when you change your current home loan to a new one that satisfies your current financial situation. It can either be done internally (with the same lender) or externally (with a different lender).  We have a useful refinance calculator to help you see the potential savings of refinancing.

Question 11

What are some benefits of refinancing?

Accepted Answer

Apart from potential financial benefits, refinancing can allow you to access the equity of your home to cover major costs such as school fees or a family holiday. It can also allow you to renovate your property which could in turn add to its value.

Question 12

How do I know which home loan suits my needs?

Accepted Answer

When you're ready for more information about the many loans on the market, it's best to chat to one of our brokers. They'll be able to take your personal circumstances and your goals into account, and recommend something that is going to work for you. It might be a combination of different types of loans.

Question 13

What documents will I need to apply for a home loan?

Accepted Answer

This will depend on the type of loan and lender that you will be going through and Moving Forward Finance will assist you with this, to give you an idea,
Identification
Passport, driver's licence, proof of age card, Birth certificate, citizenship certificate, Pension card
Income
Evidence of wages, payslip, contract. rental or investment income, and any Government income.
Loans and Savings
3 months statements of bank accounts, and any secured loans.  (we utilise a program to make this a simple process for you)
Other
If you've received a gift of money towards your deposit, a statutory declaration that the funds are an unconditional gift.
If you're using your equity in an existing property, the rates notice with the street address and title reference of the property.
If you've found the property you'll purchase, a Contract of Sale or Offer of Acceptance, and the contact details of your solicitor or conveyancer.
If you're building: a fixed price building contract plus original council approved plans

Question 14

What is a deposit bond, and how do I arrange one?"

Accepted Answer

A deposit bond is a guarantee from the bank to the seller that you will pay the home deposit at the time of settlement. It's a document, so not actual money changes hands. All of the funds, both the deposit and the purchase price, will be paid at the settlement. If the purchase does not go through for any reason and the deposit is forfeit, then the deposit bond is paid to the seller.
A deposit bond is commonly used when:
you make an off the plan purchase
you intend to bid at auction
you have equity in some property but no liquid assets
you're waiting on funds to come through from another source.

Question 15

What is a principle and interest home loan? How is it different to an interest only home loan?

Accepted Answer

A principle and interest loan is a regular home loan where your repayments pay the interest (costs of borrowing the money), but they also count towards paying off the home loan itself. This means with each payment you build equity in your home, and you owe the bank less in total.
An interest only loan means that you have elected to pay only the interest on the home loan, and not contribute to paying off the total amount borrowed to purchase the home. You may be able to elect to pay only the interest on your own for a period of time, usually 1-5 years for owner occupied loans and 1-10 years for investment property loans.

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