- The loan amount
- The loan term
- The repayment frequency
- The interest rate
- The fees & charges associated with the loan
Fixed Rate vs Variable Rate
Some lenders will also offer the opportunity to ‘split’ your loan, so that you have a fixed portion and a variable portion. Splitting your loan means that if rates rise, the fixed component of the mortgage will offer some protection against it. Conversely, if rates drop, then the variable component allows you to take advantage of lower repayments.
Your Smartline Rockingham mortgage broker will assist you with determining the best option for your situation.
How is interest calculated?
LVR (Loan to Value Ratio)
Ideally, borrowers would have a low LVR by having saved 20% or more of the property value as a deposit. In this case, you would most likely not be required to pay LMI.
If the LVR is over 80% (ie you need to borrow more than 80% of the property sale price), you will be required to pay Lenders Mortgage Insurance (LMI) as the lender would deem you to be a higher risk borrower.
LMI (Lenders Mortgage Insurance)
Mortgage Protection Insurance
You may wish to refinance for a number of reasons, for example:
- You may want to have a better interest rate with more flexible repayment options that will allow you to pay off your home sooner;
- You may wish to use the equity that you have gained for investment or renovation purposes;
- You may have a fixed rate loan that is coming to the end of the fixed rate period; or
- You may be looking to consolidate other loans such as a car loan, to better manage your finances
It is important to remember that when looking at changing home loans, there may be associated upfront and/or ongoing costs associated with changing from one to another. Your Smartline Rockingham mortgage broker can assist you with determining which fees may apply in your circumstances and whether refinancing is a suitable option for you.
It is also a good idea to review your home loan every few years assess whether it is still the best option for your situation. Smartline Rockingham mortgage brokers like to conduct Annual Reviews with our clients for this purpose.
Smartline Rockingham mortgage brokers will liaise with the settlement agent on your behalf throughout the whole process.
Principal & Interest Loan
Interest Only Loan
Line of Credit
Your Smartline Rockingham mortgage broker can assist you in establishing an LOC as part of your overall home loan application.
These accounts are a valuable tool that can assist in saving interest and therefore paying off your loan sooner. Your Smartline Rockingham mortgage broker can assist with finding a suitable loan for your needs if you require an offset facility.
In WA, dutiable property is defined as:
- land in Western Australia, which includes fixtures such as a house;
- a right over dutiable property if consideration (money) is given for the transaction;
- chattels in Western Australia, such as a motor vehicle; or
- Western Australian business assets
“Transfer duty may be described as a general revenue tax, which is imposed under the Duties Act 2008…on various dutiable transactions (whether documented or not) including transfers of real estate and certain business assets” (WA Dept. of Finance, Office of State Revenue)
Always think very carefully before acting as a guarantor for someone else’s loan, as it could impact your own financial security and credit history. In extreme cases, you may also be listed as bankrupt by the credit provider. You may even have to sell assets that weren’t offered as security for the loan to repay the outstanding debt.
Your Smartline Rockingham mortgage broker is available to fully discuss and explain the implications for both parties with these situations.