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2.19%

Fixed - 3 years

2.45%

Macquarie Bank

$1.3k

Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied

3.57

/ 5
More details

2.74%

Fixed - 5 years

2.62%

Macquarie Bank

$1.4k

Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied

2.63

/ 5
More details

2.68%

Variable

2.69%

Suncorp Bank

$1.4k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

3.56

/ 5
More details

2.29%

Variable

2.33%

Mortgage House

$1.3k

Redraw facility
Offset Account
Borrow up to 60%
Extra Repayments
Interest Only
Owner Occupied

3.47

/ 5
More details

1.98%

Fixed - 1 year

2.38%

Homestar Finance

$1.3k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

3.46

/ 5
More details

2.06%

Fixed - 3 years

2.38%

Homestar Finance

$1.3k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

3.66

/ 5
More details

2.18%

Fixed - 1 year

2.58%

Homestar Finance

$1.3k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

3.15

/ 5
More details

Learn more about home loans

Engineers are the building blocks of the Australian economy, and several lenders are willing to offer considerable discounts on home loans to engineers. As an engineer, you can also avail yourself of the flexible policies that lenders offer for members of your profession.

If you’re an engineer and in the market to purchase your dream home, find out whether you’re eligible for a waiver on Lenders Mortgage Insurance (LMI) and other special interest rate discounts. These were previously offered only to doctors, lawyers, and professionals from a few specific industries. However, after a change of policy, engineers can now avail themselves of discounts of up to 85 per cent on LMI.

What are the types of discounts and waivers that I can get as an engineer?

Several lenders view engineers as low-risk borrowers and are willing to offer them attractive home loan deals to get their business. If your annual income meets or exceeds $150,000, you stand a greater chance of enjoying these particular perks.

Most lenders will allow you to borrow up to 90 per cent of the value of your property, while also waiving LMI, thus helping you save thousands of dollars. Depending on your years of experience, annual income and savings, you could also negotiate better interest rates from the lender than advertised to the general public.

If you’re taking out a loan with a 90 per cent Loan-to-Value Ratio (LVR), some banks may waive their requirement of you proving that you have substantial savings. In fact, if you’re considering purchasing multiple properties at the same time, you could enjoy a higher exposure limit. This is the total amount of debt you can have with one or multiple lenders and makes you eligible for a higher loan amount.

If you’re in the mining industry and employed on a FIFO (fly-in-fly-out) basis, lenders are willing to be more lenient when applying their credit criteria. Most of these lenders also relax their income verification rules significantly because of your employment status. Also, if you’re considering buying your home or making an investment in a mining town, lenders are unlikely to impose any location restrictions either.

How do I check my eligibility for discounts and waivers on an engineer mortgage loan?

It’s actually quite simple to establish whether you’re eligible to receive a special interest rate discount as well as save on LMI on your home loan. If you fulfil the following criteria, you could soon be well on your way to purchasing your dream home.

Most lenders will consider your application for a home loan if you have worked as an engineer with your current employer for at least one year. Alternatively, you could also be a self-employed engineer with at least two years of work experience in the industry.

Your credit history also plays an important role in your engineer home loan application. A clean credit file, free from defaults, bankruptcies, etc., has a higher chance of working in your favour.

While not all lenders insist on this, demonstrating that you will be able to raise at least a 10 per cent deposit from your savings will be a definite advantage. This requirement indicates that you are in a position to cover the upfront costs such as the deposit, stamp duty and other ancillary purchasing costs.

Each lender will have its own set of lending policies and guidelines, and it’s important to understand these as best you can before applying for your loan.

Are all engineers eligible for the loan?

Typically, lenders don’t make any distinction between different types of engineers. All professionals from the industry are eligible for discounts on their interest rate, depending on their mortgage size.

However, certain associations and memberships could be mandated by some lenders, and it is a good idea to check those beforehand. These include:

  • Mining engineers: Should be a member of Engineers Australia
  • Surveyors: Should be a member of the Institution of Surveyors in the state where you work. Alternatively, you could be a member of the Surveying & Spatial Sciences Institute of Australia (SSSI)
  • Mine surveyors: Must be a member of the Australian Institute of Mine Surveyors (AIMS)
  • Quantity surveyors: Must be a member of the Australian Institute of Quantity Surveyors
  • Geologists: Should be a Fellow of the Australian Institute of Geoscientists (FAIG)
  • Geophysicists: Must be a Fellow of the Australian Institute of Geoscientists (FAIG)

Besides these professional bodies, you may hold a membership to another industry association. Before applying for your home loan, find out whether your membership makes you eligible for interest rate discounts. Of course, your income and the size of your loan will also play an important role in determining the final discount available. As a general rule, the larger your income, the more you can borrow.

 

What kind of savings on LMI can I expect on a home loan for engineers?

LMI is a safety net that protects the financial interests of the lender in the event a borrower defaults on repayment. It helps them recoup any losses if the sale of the property does not cover the loan amount.

LMI premiums, like any other insurance premium, are priced based on the possibility of the insured event actually occurring. Simply put, the greater the probability of the borrower defaulting on the mortgage where the lender suffers a loss, the more expensive the premium will be. Additionally, LMI premiums aren’t flat rates but are dependent on the size of the loan and the LVR, and therefore vary on a case-to-case basis.

Why do banks support engineers and offer discounts on home loans?

Engineering professionals are at an advantage when it comes to buying their own home. Lenders consider engineers, mining engineers in particular, to be lower risk borrowers than your typical borrower, due to several reasons. Mining engineers have higher than average incomes; have full-time employment prospects; and are generally known for their strong track record of repaying loans on time. So it isn’t at all surprising that most lenders would want to get a share of their business.

Depending on your particular situation and the guidelines of the lender, you may be eligible for one or all of the following special discounts:

  • Significantly reduced interest rates that are much lower than the bank’s standard variable interest rate
  • The ability to borrow a higher loan amount than most borrowers, improving your chances of securing that dream home you have your heart set on
  • Not required to pay LMI, usually charged when borrowing more than 80 per cent of the value of their property saving you thousands in upfront costs

Engineers can enjoy this preferential treatment with these discounts which aren’t offered to the general public. You might want to speak with an experienced mortgage broker to help negotiate a great deal on your behalf.

Why is a mortgage broker valuable when applying for an engineer’s home loan?

If you take home a sizable salary and are a full-time employee, you’re already on your way to qualifying for a home loan to buy your dream property. But when you’re starting the home loan application process, you’ll want to have all the relevant information and advice from an experienced person like a mortgage broker can help. 

You might not be aware that you have access to discounts that can possibly save thousands of dollars on your engineer mortgage loan..

Mortgage brokers have years of experience working with a range of lenders, so they know how to obtain the right home loan for different and unique borrowers. They’ve built a good rapport with different lenders and know the best ways to get you the maximum possible discount based on your current situation.

Home loan for engineers – FAQs answered

Are you an engineer, geophysicist or surveyor looking to purchase your dream home? Here are answers to some commonly asked questions regarding discounts and special interest rates that you may be eligible for.

How much money can I save by avoiding LMI?

LMI can be a sizable fee that you may need to pay upfront or add to your loan amount, with a $1.2 million property racking up an LMI amount of around $25,000. By avoiding LMI, you’ll be able to save yourself thousands of dollars.

The actual cost of the LMI premium you could be paying is calculated based on the value of the specific property you are looking to purchase.

What are the various discounts and special reduced rates that engineers can enjoy?

As an engineer, you might be eligible to have the LMI waived, and a specialist mortgage broker may also be able to negotiate other special discounts for you:

  • Discounted interest rates
    These are typically well below the bank’s standard variable rate and also lower than any interest rate discounts offered to the general public.

  • Higher exposure limits
    Exposure refers to the total debt you have and is taken into account when you apply for a home loan. Lenders will place limits on this exposure as it indicates that you may struggle to repay your loan. If you’re an engineer and are considering starting a property portfolio, you can benefit from high exposure limits. Which means you can be eligible to borrow more to purchase multiple investment properties at the same time.

Are all borrowers required to purchase Lenders Mortgage Insurance?

In most cases, only loans greater than 80 per cent LVR are required to pay for LMI. If you’re willing to put down a 20 per cent deposit (this is on top of other upfront costs), you might not be required to pay an LMI premium.

As an engineer, you may be able to have your LMI waived if you fit the lender’s eligibility requirements for that waiver.

Is LMI meant to protect my interests?

No, LMI protects the lender in the unfortunate event of payment default, and not the borrower. LMI covers any costs or losses the lender incurs if you default on your loan and they have to sell your property.  

You can purchase mortgage protection insurance which protects you the borrower if you struggle to repay your home loan. You can also take out income protection insurance which will also assist if your employment situation changes due to health or other issues.

If you work on a contract basis as an engineer, you might consider mortgage protection or income protection insurance. It will help cover your loan if you’re ever unable to retain your contract work.

 

Frequently asked questions

Can I change jobs while I am applying for a home loan?

Whether you’re a new borrower or you’re refinancing your home loan, many lenders require you to be in a permanent job with the same employer for at least 6 months before applying for a home loan. Different lenders have different requirements. 

If your work situation changes for any reason while you’re applying for a mortgage, this could reduce your chances of successfully completing the process. Contacting the lender as soon as you know your employment situation is changing may allow you to work something out. 

What are the responsibilities of a mortgage broker?

Mortgage brokers act as the go-between for borrowers looking for a home loan and the lenders offering the loan. They offer personalised advice to help borrowers choose the right home loan for their needs.

In Australia, mortgage brokers are required by law to carry an Australian Credit License (ACL) if they offer credit assistance services. Which is the legal term for guidance regarding the different kinds of credit offered by lenders, including home loan mortgages. They may not need this license if they are working for an aggregator, for instance, as a franchisee. In both these situations, they need to comply with the regulations laid down by the Australian Securities and Investments Commission (ASIC).

These regulations, which are stipulated by Australian legislation, require mortgage brokers to comply with what are called “responsible lending” and “best interest” obligations. Responsible lending obligations mean brokers have to suggest “suitable” home loans. This means loans that you can easily qualify for,  actually meet your needs, and don’t prove unnecessarily challenging for you.

Starting 1 January 2021, mortgage brokers must comply with best interest obligations in addition to responsible lending obligations. These require mortgage brokers to act in the best interest of their customers and also requires them to prioritise their customers’ interests over their own. For instance, a mortgage broker may not recommend a lender who gives them a commission if that lender’s home loan offer does not benefit that particular customer.

How can I get a home loan with bad credit?

If you want to get a home loan with bad credit, you need to convince a lender that your problems are behind you and that you will, indeed, be able to repay a mortgage.

One step you might want to take is to visit a mortgage broker who specialises in bad credit home loans (also known as ‘non-conforming home loans’ or ‘sub-prime home loans’). An experienced broker will know which lenders to approach, and how to plead your case with each of them.

Two points to bear in mind are:

  • Many home loan lenders don’t provide bad credit mortgages
  • Each lender has its own policies, and therefore favours different things

If you’d prefer to directly approach the lender yourself, you’re more likely to find success with smaller non-bank lenders that specialise in bad credit home loans (as opposed to bigger banks that prefer ‘vanilla’ mortgages). That’s because these smaller lenders are more likely to treat you as a unique individual rather than judge you according to a one-size-fits-all policy.

Lenders try to minimise their risk, so if you want to get a home loan with bad credit, you need to do everything you can to convince lenders that you’re safer than your credit history might suggest. If possible, provide paperwork that shows:

  • You have a secure job
  • You have a steady income
  • You’ve been reducing your debts
  • You’ve been increasing your savings

What are the pros and cons of no-deposit home loans?

It’s no longer possible to get a no-deposit home loan in Australia. In some circumstances, you might be able to take out a mortgage with a 5 per cent deposit – but before you do so, it’s important to weigh up the pros and cons.

The big advantage of borrowing 95 per cent (also known as a 95 per cent home loan) is that you get to buy your property sooner. That may be particularly important if you plan to purchase in a rising market, where prices are increasing faster than you can accumulate savings.

But 95 per cent home loans also have disadvantages. First, the 95 per cent home loan market is relatively small, so you’ll have fewer options to choose from. Second, you’ll probably have to pay LMI (lender’s mortgage insurance). Third, you’ll probably be charged a higher interest rate. Fourth, the more you borrow, the more you’ll ultimately have to pay in interest. Fifth, if your property declines in value, your mortgage might end up being worth more than your home.

Will I have to pay lenders' mortgage insurance twice if I refinance?

If your deposit was less than 20 per cent of your property’s value when you took out your original loan, you may have paid lenders’ mortgage insurance (LMI) to cover the lender against the risk that you may default on your repayments. 

If you refinance to a new home loan, but still don’t have enough deposit and/or equity to provide 20 per cent security, you’ll need to pay for the lender’s LMI a second time. This could potentially add thousands or tens of thousands of dollars in upfront costs to your mortgage, so it’s important to consider whether the financial benefits of refinancing may be worth these costs.

I can't pick a loan. Should I apply to multiple lenders?

Applying for home loans with multiple lenders at once can affect your credit history, as multiple loan applications in short succession can make you look like a risky borrower. Comparing home loans from different lenders, assessing their features and benefits, and making one application to a preferred lender may help to improve your chances of success

How do I refinance my home loan?

Refinancing your home loan can involve a bit of paperwork but if you are moving on to a lower rate, it can save you thousands of dollars in the long-run. The first step is finding another loan on the market that you think will save you money over time or offer features that your current loan does not have. Once you have selected a couple of loans you are interested in, compare them with your current loan to see if you will save money in the long term on interest rates and fees. Remember to factor in any break fees and set up fees when assessing the cost of switching.

Once you have decided on a new loan it is simply a matter of contacting your existing and future lender to get the new loan set up. Beware that some lenders will revert your loan back to a 25 or 30 year term when you refinance which may mean initial lower repayments but may cost you more in the long run.

What is an interest-only loan? How do I work out interest-only loan repayments?

An ‘interest-only’ loan is a loan where the borrower is only required to pay back the interest on the loan. Typically, banks will only let lenders do this for a fixed period of time – often five years – however some lenders will be happy to extend this.

Interest-only loans are popular with investors who aren’t keen on putting a lot of capital into their investment property. It is also a handy feature for people who need to reduce their mortgage repayments for a short period of time while they are travelling overseas, or taking time off to look after a new family member, for example.

While moving on to interest-only will make your monthly repayments cheaper, ultimately, you will end up paying your bank thousands of dollars extra in interest to make up for the time where you weren’t paying off the principal.

What is a loan-to-value ratio (LVR)?

A loan-to-value ratio (otherwise known as a Loan to Valuation Ratio or LVR), is a calculation lenders make to work out the value of your loan versus the value of your property, expressed as a percentage.   Lenders use this calculation to help assess your suitability for a home loan, and whether you need to pay lender’s mortgage insurance (LMI). As a general rule, most banks will require you to pay LMI if your loan-to-value ratio is 80 per cent or more.   LVR is worked out by dividing the loan amount by the value of the property. If you are looking for a quick ball-park estimate of LVR, the size of your deposit is a good indicator as it is directly proportionate to your LVR. For instance, a loan with an LVR of 80 per cent requires a deposit of 20 per cent, while a 90 per cent LVR requires 10 per cent down payment. 

LOAN AMOUNT / PROPERTY VALUE = LVR%

While this all sounds simple enough, it is worth doing a more accurate calculation of LVR before you commit to buying a place as there are some traps to be aware of. Firstly, the ‘loan amount’ is the price you paid for the property plus additional costs such as stamp duty and legal fees, minus your deposit amount. Secondly, the ‘property value’ is determined by your lender’s valuation of the property, not the price you paid for it, and sometimes these can differ so where possible, try and get your bank to evaluate the property before you put in an offer.

How much can I borrow with a guaranteed home loan?

Some lenders will allow you to borrow 100 per cent of the value of the property with a guaranteed home loan. For that to happen, the lender would have to feel confident in your ability to pay off the mortgage and in the security provided by your guarantor.

How can I calculate interest on my home loan?

You can calculate the total interest you will pay over the life of your loan by using a mortgage calculator. The calculator will estimate your repayments based on the amount you want to borrow, the interest rate, the length of your loan, whether you are an owner-occupier or an investor and whether you plan to pay ‘principal and interest’ or ‘interest-only’.

If you are buying a new home, the calculator will also help you work out how much you’ll need to pay in stamp duty and other related costs.

What do mortgage brokers do?

Mortgage brokers are finance professionals who help borrowers organise home loans with lenders. As such, they act as middlemen between borrowers and lenders.

While bank staff recommend home loan products only from their own employer, brokers are independent, so they can recommend products from a range of institutions.

Brokers need to be accredited with a particular lender to be able to work with that lender. A typical broker will be accredited with anywhere from 10 to 30 lenders – the big four banks, as well as a range of smaller banks, credit unions and non-bank lenders.

As a general rule, brokers don’t charge consumers for their services; instead, they receive commissions from lenders whenever they place a borrower with that institution.

How much deposit will I need to buy a house?

A deposit of 20 per cent or more is ideal as it’s typically the amount a lender sees as ‘safe’. Being a safe borrower is a good position to be in as you’ll have a range of lenders to pick from, with some likely to offer up a lower interest rate as a reward. Additionally, a deposit of over 20 per cent usually eliminates the need for lender’s mortgage insurance (LMI) which can add thousands to the cost of buying your home.

While you can get a loan with as little as 5 per cent deposit, it’s definitely not the most advisable way to enter the home loan market. Banks view people with low deposits as ‘high risk’ and often charge higher interest rates as a precaution. The smaller your deposit, the more you’ll also have to pay in LMI as it works on a sliding scale dependent on your deposit size.

Who has the best home loan?

Determining who has the ‘best’ home loan really does depend on your own personal circumstances and requirements. It may be tempting to judge a loan merely on the interest rate but there can be added value in the extras on offer, such as offset and redraw facilities, that aren’t available with all low rate loans.

To determine which loan is the best for you, think about whether you would prefer the consistency of a fixed loan or the flexibility and potential benefits of a variable loan. Then determine which features will be necessary throughout the life of your loan. Thirdly, consider how much you are willing to pay in fees for the loan you want. Once you find the perfect combination of these three elements you are on your way to determining the best loan for you. 

Does Australia have no cost refinancing?

No Cost Refinancing is an option available in the US where the lender or broker covers your switching costs, such as appraisal fees and settlement costs. Unfortunately, no cost refinancing isn’t available in Australia.

Can I get a home loan if I am on an employment contract?

Some lenders will allow you to apply for a mortgage if you are a contractor or freelancer. However, many lenders prefer you to be in a permanent, ongoing role, because a more stable income means you’re more likely to keep up with your repayments.

If you’re a contractor, freelancer, or are otherwise self-employed, it may still be possible to apply for a low-doc home loan, as these mortgages require less specific proof of income.

Is there a limit to how many times I can refinance?

There is no set limit to how many times you are allowed to refinance. Some surveyed RateCity users have refinanced up to three times.

However, if you refinance several times in short succession, it could affect your credit score. Lenders assess your credit score when you apply for new loans, so if you end up with bad credit, you may not be able to refinance if and when you really need to.

Before refinancing multiple times, consider getting a copy of your credit report and ensure your credit history is in good shape for future refinances.

I have a poor credit rating. Am I still able to get a mortgage?

Some lenders still allow you to apply for a home loan if you have impaired credit. However, you may pay a slightly higher interest rate and/or higher fees. This is to help offset the higher risk that you may default on your repayments.

Will I be paying two mortgages at once when I refinance?

No, given the way the loan and title transfer works, you will not have to pay two mortgages at the one time. You will make your last monthly repayment on loan number one and then the following month you will start paying off loan number two.

If I don't like my new lender after I refinance, can I go back to my previous lender?

If you wish to return to your previous lender after refinancing, you will have to go through the refinancing process again and pay a second set of discharge and upfront fees. 

Therefore, before you refinance, it’s important to weigh up the new prospective lender against your current lender in a number of areas, including fees, flexibility, customer service and interest rate.