Showing home loans based on a loan of
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with a deposit of
Advertised Rate

4.89%

Variable

Comparison Rate*

5.51%

Company
Freedom Lend
Repayment

$1,223

monthly

Features
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Borrow up to 65%
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1.97

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Advertised Rate

5.04%

Variable

Comparison Rate*

5.66%

Company
Freedom Lend
Repayment

$1,260

monthly

Features
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Borrow up to 70%
Extra Repayments
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Owner Occupied
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1.97

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Advertised Rate

5.29%

Variable

Comparison Rate*

5.90%

Company
Freedom Lend
Repayment

$1,323

monthly

Features
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Borrow up to 75%
Extra Repayments
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Owner Occupied
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1.97

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Advertised Rate

4.49%

Variable

Comparison Rate*

5.04%

Company
Freedom Lend
Repayment

$1,666

monthly

Features
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Borrow up to 65%
Extra Repayments
Interest Only
Owner Occupied
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1.97

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Advertised Rate

4.64%

Variable

Comparison Rate*

5.18%

Company
Freedom Lend
Repayment

$1,691

monthly

Features
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Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
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1.97

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Advertised Rate

4.89%

Variable

Comparison Rate*

5.43%

Company
Freedom Lend
Repayment

$1,735

monthly

Features
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Offset Account
Borrow up to 75%
Extra Repayments
Interest Only
Owner Occupied
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1.97

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Advertised Rate

4.75%

Fixed - 5 years

Comparison Rate*

4.76%

Company
Firstmac
Repayment

$1,710

monthly

Features
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Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.23

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Advertised Rate

4.75%

Variable

Comparison Rate*

4.76%

Company
Firstmac
Repayment

$1,710

monthly

Features
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Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.33

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Advertised Rate

4.75%

Fixed - 5 years

Comparison Rate*

4.78%

Company
Firstmac
Repayment

$1,710

monthly

Features
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Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.23

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Advertised Rate

4.75%

Variable

Comparison Rate*

4.78%

Company
Firstmac
Repayment

$1,710

monthly

Features
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Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.33

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Advertised Rate

4.99%

Variable

Comparison Rate*

5.00%

Company
Firstmac
Repayment

$1,752

monthly

Features
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Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.33

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Advertised Rate

4.99%

Variable

Comparison Rate*

5.02%

Company
Firstmac
Repayment

$1,752

monthly

Features
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Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.33

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Advertised Rate

4.99%

Fixed - 5 years

Comparison Rate*

5.02%

Company
Firstmac
Repayment

$1,752

monthly

Features
Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.23

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Advertised Rate

4.85%

Variable

Comparison Rate*

5.28%

Company
Liberty Financial
Repayment

$1,728

monthly

Features
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Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.33

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Product
Advertised Rate

4.99%

Variable

Comparison Rate*

5.48%

Company
WLTH
Repayment

$1,752

monthly

Features
Redraw facility
Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.76

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Advertised Rate

4.99%

Variable

Comparison Rate*

5.48%

Company
Mortgage House
Repayment

$1,752

monthly

Features
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Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.71

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Product
Advertised Rate

5.48%

Variable

Comparison Rate*

5.96%

Company
WLTH
Repayment

$1,839

monthly

Features
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Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.76

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Product
Advertised Rate

5.68%

Variable

Comparison Rate*

6.16%

Company
WLTH
Repayment

$1,875

monthly

Features
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Offset Account
Borrow up to 70%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.76

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Advertised Rate

4.99%

Fixed - 5 years

Comparison Rate*

5.00%

Company
Firstmac
Repayment

$1,752

monthly

Features
Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied
Real Time Rating™

1.23

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Advertised Rate

5.50%

Variable

Comparison Rate*

5.68%

Company
Regional Australia Bank
Repayment

$1,842

monthly

Features
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Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied
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1.40

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Learn more about home loans

What is an SMSF loan?

An SMSF loan describes money loaned or borrowed by a Self-Managed Super Fund (SMSF) and its trustees, for the purpose of making an investment that can help grow the SMSF members' retirement savings. 

An SMSF is a superannuation fund managed by the trustees of that fund, who are also the members of that fund. A self-managed superannuation fund may not be the best option for every Australian's financial situation --consider seeking financial advice before you enquire about an SMSF trust.

How does an SMSF work?

Acting essentially as a ‘do-it-yourself’ superannuation fund, members of an SMSF are responsible for complying with Australian superannuation and tax laws, and must make investment decisions on behalf of the fund. 

As the purpose of an SMSF is to generate returns for the trustees’ retirement, borrowing or lending money must be for the sole benefit of the SMSF, not the individual trustees. Investments must also not generate value to be enjoyed in the present day, but focus on returns for when the trustees retire.

Setting up a Self-Managed Super Fund for the purpose of accessing your super early, renovating your home, or purchasing assets that benefit an individual trustee is illegal. As such, it’s important for trustees to seek professional advice from a financial adviser before setting up an SMSF.

How are SMSFs allowed to invest their funds?

SMSFs can invest in conventional assets such as shares, term deposits, managed funds and property.

SMSFs can also buy ‘collectibles’ such as artwork, jewellery, antiques, coins, stamps, vintage cars and wine – although there are special rules that apply to collectibles.

Investments must be made on an arm’s length basis, which means that assets must be bought and sold at market prices, while income must reflect the market rate of return.

As a general rule, SMSFs can’t buy assets from members or related parties.

What is an SMSF investment strategy?

All SMSFs are required to have an investment strategy, which should explain what assets the fund will buy and what objectives it will pursue. This strategy must be reviewed regularly.

Issues to consider include how much risk the SMSF will take, how easily its assets can be converted into cash and how it will pay out benefits.

Borrowing from an SMSF

Some people assume that an SMSF is beneficial as it can provide them with early access to funds, or empower them to use their SMSF to borrow money for personal use. 

This is inaccurate and doing so can cost you dearly. Using money from an SMSF to fund a purchase must be for the benefit of the fund, not the individual members or trustees.

Borrowing from an SMSF

Some people assume that an SMSF is beneficial as it can provide them with early access to funds, or empower them to use their SMSF to borrow money for personal use. 

This is inaccurate and doing so can cost you dearly. Using money from an SMSF to fund a purchase must be for the benefit of the fund, not the individual members or trustees.

When is an SMSF loan illegal?

SMSF borrowing for individual gain is illegal. If you are caught borrowing money from an SMSF for the purpose of personal benefit, the fund can be made ‘non-complying’ by the ATO. This means you can lose access to up to half of the funds in your SMSF. You can also incur serious penalties, including thousands of dollars in fines, and potentially be sentenced to jail.

As a rule, SMSF trustees are generally not allowed to borrow money at all, especially when they are borrowing money to benefit any related parties. These related parties can include SMSF members, friends, relatives or business associates. Trustees are also not allowed to borrow money that does not generate a market return. This is because a super fund is run for the sole purpose of providing benefits to members when they retire.

An SMSF loan is legal when it is a Limited Recourse Borrowing Arrangement (LBRA). 

An LBRA is a loan taken out by an SMSF trustee with a third party lender, to purchase a single asset (or collection of identical assets that have the same market value) that provides investment returns to the SMSF. 

This type of SMSF loan is generally a long-term investment, to provide a market return, and is legal.

If the SMSF defaults on the LBRA, the third party lender’s rights are limited to recovering only that asset, so that the other assets owned by the SMSF remain protected.

Why do you need an LBRA for an SMSF loan?

When borrowing from an SMSF in Australia, trustees must organise an LBRA. If they do not, they are breaking the ATO superannuation laws. If an auditor reports that your SMSF has borrowed money without an LBRA, you may be ordered to sell the property and your fund could be made ‘non-complying’.

There are many costs involved with selling a property, and if you borrow money without such an arrangement, you may have to sell the property for less than the SMSF paid for it. This can also result in thousands of dollars in fines for the individual trustee who set up the illegal loan.

Borrowing money with an LBRA can work, however it’s important that you follow all the rules and speak with an SMSF professional before you sign anything.

You can learn more about limited recourse borrowing arrangements from the ATO.

Can you purchase property with SMSF funds?

As long as you follow the rules, and the reason for purchasing property is to create financial returns that are funnelled directly back into your SMSF, you may be able to purchase property with an SMSF loan. 

Any property purchased with an SMSF loan must be for the sole benefit of the SMSF, not the individual trustees. The property must provide a market return, which will be used to provide retirement benefits for the super fund members when they reach the retirement age of 65.

While you can both borrow and loan money from an SMSF for the purpose of buying property, there are many restrictions, regulations and conditions that you must meet to ensure that the purchase is legal.

If the purchase is not legal as per the Australian Taxation Office (ATO) guidelines, you may risk losing half of the assets in your SMSF, and face thousands of dollars in fines.

Self Managed Super Funds restrict investments that concern related parties, like members, friends and family. This means you cannot purchase property that a related party owns or has owned. 

However, a market value purchase of business real property is a legal property purchase.

What is business real property?

Business real property generally refers to land and buildings used wholly and exclusively for business purposes. If you are purchasing business real property from SMSF finance, you must also ensure this investment meets your SMSF investment strategy to maximise the returns of the fund.

There are some exceptions to the rule that land and buildings must be wholly and exclusively used for business purposes. If, for example, you choose to purchase a rural working farm with funds from the SMSF, and there is a dwelling on the farm that is for private use, you may still be able to count this purchase as business real property.

To do this, you need to prove that the rural farm is predominantly for business use, and the dwelling must be in an area no more than two hectares.

You can learn more about business real property from the ATO.

Can you loan money for property with funds from an SMSF?

Generally, an SMSF is not allowed to loan money, unless SMSF lending is in the best interests of the fund members, and complies with your SMSF investment strategy.

An SMSF cannot under any circumstances loan money to or provide direct financial assistance to any related party, nor can the fund guarantee loans for members or their relatives.

However, an SMSF can legally loan money to an individual or business, to generate a positive return for super members.

If your SMSF is considering loaning money to an individual or business, it must be in the best interests of all fund members. It must also be for the sole purpose of generating a market return for members when they retire.

For instance, a business loan that charges interest over a 10-year period may qualify as a legal SMSF loan, as long as it matches the SMSF investment strategy and does not involve any related party.

If your fund is audited, and it is found that a loan arrangement is not in the best interests of the members of the SMSF, your fund may be labelled ‘non-complying’ by the ATO. This means the SMSF could lose up to half of its assets, and fund members could face serious penalties. 

This is why it is best to speak to a financial adviser or an SMSF professional before you draft any loan arrangements on behalf of the SMSF.

What are the risks of buying property with SMSF loans?

  • Higher costs: Specialist SMSF home loans tend to cost more than typical mortgage products. This is partially because there are fewer lenders offering SMSF home loans. This could also potentially make it harder to successfully refinance. 
  • Requires cash flow: The repayments on your SMSF loan will need to come out of your SMSF, so you’ll need to keep enough liquidity in the fund to manage these payments.
  • Harder to cancel: An SMSF property loan can’t be easily unwound if it becomes necessary (such as if your documents and contract aren’t set up properly), meaning you may be forced to sell the property, possibly at a loss to the fund.
  • Potential tax losses: Unlike a typical property investment where the borrower can benefit from negative gearing, with an SMSF home loan you can’t offset tax losses from the property against your taxable income outside the fund.  
  • Can’t alter the property: You can’t change the character of the property until you pay off the SMSF property loan. You may be able to make minor repairs, but major renovations would be off the table.

How do I purchase property through my SMSF?

  • Calculate what you can afford: You’ll want to be confident that your SMSF can afford the loan interest repayments on any potential mortgage before you apply. You’ll likely need to have at least $150,000 or more in assets in the SMSF, and keep the fund topped up with cash from super contributions and potential rent on the property to cover the repayments, plus stamp duty and other ongoing fees and mortgage costs -- consider checking the SMSF loan's comparison rate.
  • Find a property: It can be a residential property or a commercial property, but it can't be associated with the fund’s members or relatives (e.g. can’t be bought from, lived in, or rented by a fund member or relative of a fund member).
  • Set up an LRBA: This separate legal entity will look after the mortgage on the property on behalf of the SMSF, partially to help protect the fund’s assets in case of a default.
  • Apply for the loan: This process is broadly similar to applying for a typical investment property. However, because of the complexity of the regulations surrounding SMSFs, and the specialised requirements for some SMSF loans (for example, some lenders will require personal guarantees from the SMSF trustees), it may be worth seeking financial advice from a mortgage broker or similar financial expert. 

How much can I borrow with an SMSF home loan?

Much like when you apply for a more traditional home loan, the amount you can borrow with an SMSF loan will partly depend on how much you can afford in loan repayments. The more cash you have going into your SMSF as super contributions, dividends and interest (possibly also including forecast rental income from the investment property you’re buying), the higher the potential loan amount you may be able to put towards your investment property. Depending on the loan term and interest rate of the loan you’re applying for (which may be a variable rate or fixed for a limited time), this may allow you to borrow more money to purchase a higher-value property.

Much like a typical investment home loan, you’ll also need to pay a deposit when you buy an investment property with an SMSF loan. Due to the extra risk and complexity of SMSF loans, your SMSF will likely have to provide a higher percentage of the property’s value as deposit up front (perhaps 30 per cent or more, rather than the more typical 20 per cent), for a lower loan to value ratio (LVR).

Frequently asked questions

What is a line of credit?

A line of credit, also known as a home equity loan, is a type of mortgage that allows you to borrow money using the equity in your property.

Equity is the value of your property, less any outstanding debt against it. For example, if you have a $500,000 property and a $300,000 mortgage against the property, then you have $200,000 equity. This is the portion of the property that you actually own.

This type of loan is a flexible mortgage that allows you to draw on funds when you need them, similar to a credit card.

What are extra repayments?

Additional payments to your home loan above the minimum monthly instalments, which can help to reduce the loan’s term and remaining payable interest.

How does a line of credit work?

A line of credit functions in a similar way to a credit card. You have a pre-approved borrowing limit and can draw on as little or as much of that sum as you need it, with interest paid on the outstanding balance.

Popular products include Commonwealth Bank Viridian Line of Credit, ANZ Equity Manager, Westpac Equity Access and NAB Flexiplus.

How can I get ANZ home loan pre-approval?

Shopping for a new home is an exciting experience and getting a pre-approval on the loan may give you the peace of mind that you are looking at properties within your budget. 

At the time of applying for the ANZ Bank home loan pre-approval, you will be required to provide proof of employment and income, along with records of your savings and debts.

An ANZ home loan pre-approval time frame is usually up to three months. However, being pre-approved doesn’t necessarily mean you will get your home loan. Other factors could lead to your home loan application being rejected, even with a prior pre-approval. Some factors include the property evaluation not meeting the bank’s criteria or a change in your financial circumstances.

You can make an application for ANZ home loan pre-approval online or call on 1800100641 Mon-Fri 8.00 am to 8.00 pm (AEST).

Where can I get all the information about an ANZ first home buyer’s loan?

As a first home buyer, you may require help and hand-holding, and as such ANZ has the buying your first home section on its website full of important information. ANZ also has a form in this section you can fill out to get a free consultation from an ANZ First Home Coach and create your own plan for buying your first home. This coach will help you understand where your current income is being spent and plan for your home loan repayments. You’ll get a clear picture of the costs involved in purchasing a property and how to budget or save for these costs. The coach will help you understand different deposit options and manage your accounts to enhance your savings.

There are three types of ANZ first home loans - Standard Variable, Fixed, and Equity Manager. The features, interest rates, and terms for each are different, and you can compare them here.

When they apply for an ANZ home loan, first home buyers can also get guidance on applying for the First Home Owner Grant (FHOG). This is a one-off government grant that may be available to you when you’re buying your first home. The eligibility criteria for FHOG differs between the different states and territories, which is why it’s helpful to have expert advice when applying.

How do I get a Suncorp home loan pre-approval?

Getting home loan pre-approval helps you work out a budget to help you search for a suitable property and make an offer with confidence. Once you put in an application, you should get your pre-approval outcome within two business days. To help get a fast turnaround time of your pre-approval application, ensure all the information and documentation that Suncorp requires. This includes proof of identification, recent payslips, bank account and credit card statements.

You can submit the home loan pre-approval application online. You’ll be asked for information about your income, expenses, assets, and debts. It should take you about 10 minutes to fill out the application, and you can do it free of charge. A Suncorp lending specialist will review your application and contact you within 24 hours or the next working day. Suncorp will not run a credit check until you have heard from this lending specialist.

Once you get Suncorp home loan pre-approval, it’s valid for 90 days. If you don’t find a property you wish to buy in this time you may be able to apply for an extension, speak to your Suncorp lending specialist about this.

Does Westpac offer loan maternity leave options?

Having a baby or planning for one can bring about a lot of changes in your life, including to the hip pocket. You may need to re-do the budget to make sure you can afford the upcoming expenses, especially if one partner is taking parental leave to look after the little one. 

Some families find it difficult to meet their home loan repayment obligations during this period. Flexible options, such as the Westpac home loan maternity leave offerings, have been put together to help reduce the pressure of repayments during parental leave.

Westpac offers a couple of choices, depending on your circumstances:

  • Parental Leave Mortgage Repayment Reduction: You could get your home loan repayments reduced for up to 12 months for home loans with a term longer than a year. 
  • Mortgage Repayment Pause: You can pause repayments while on maternity leave, provided you’ve made additional repayments earlier.

When applying for a home loan while pregnant, Westpac has said it will recognise paid maternity leave and back-to-work salaries. All you need is a letter from your employer verifying your return-to-work date and the nature of your employment. Your partner’s income, government entitlements, savings and investments will may help your application.

How can I apply for a first home buyers loan with Commonwealth Bank?

Getting a home loan requires planning and research. If you are considering a home loan with the Commonwealth Bank, you can find the information you need in the buying your first home section of the bank’s website.

You can see the steps you should take before applying for the loan and use the calculators to work out how much you can borrow, what your monthly repayments would be and the upfront costs you’d likely pay.

You can also book a time with a Commonwealth first home loan specialist by calling 13 2221.

CommBank publishes a property report that may help you understand the real estate market. The bank has also created a CommBank Property App that you can use to search for property.  The link to download this app is available on the same webpage.

If you are eligible for the First Home Loan Deposit Scheme, CommBank will help you process your application. The scheme helps first home buyers to purchase a home with a low deposit. You can read details about this scheme here and speak with a CommBank home lending specialist to understand your options.

What are the NAB term deposit interest rates for businesses?

If you’re looking to lock in a return on your business savings, one option is a business term deposit with NAB. The big four bank provides competitive interest rates while giving you the flexibility to choose the term. NAB offers business term deposit interest rates for investments of between $5,000 to $499,999.

NAB doesn’t charge any monthly account or application fees. The interest is calculated daily and for the 90-day term and six months term, you will get paid when the deposit matures. For the 12 months term, you can either choose to get paid monthly, quarterly, half-yearly or annually. 

If you wish to withdraw your funds before the deposit matures, you need to give NAB 31 days notice. However, they do make exceptions if you’re experiencing hardship and need the funds immediately. Either way, you may have to bear the prepayment cost, which you can learn more about in the Terms and Conditions.

Remaining loan term

The length of time it will take to pay off your current home loan, based on the currently-entered mortgage balance, monthly repayment and interest rate.

How long does Bankwest take to approve home loans?

Full approval for a home loan usually involves a property valuation, which, Bankwest suggests, can take “a week or two”. As a result, getting your home loan approved may take longer. However, you may get full approval within this time if you applied for and received conditional approval, sometimes called a pre-approval, from Bankwest before finalising the home you want to buy.  

Another way of speeding up approvals can be by completing, signing, and submitting your home loan application digitally. Essentially, you give the bank or your mortgage broker a copy of your home’s sale contract and then complete the rest of the steps online. Bankwest has claimed this cuts the approval time to less than four days, although this may only happen if your income and credit history can be verified easily, or if your home’s valuation doesn’t take time.

How do you qualify for a CBA home loan with casual employment?

Qualifying for a home loan without a full-time job may be challenging, but it can be done. The first step is to understand how a CBA home loan is assessed when you have casual employment.

Most lenders will assess your expenses and savings while checking your loan eligibility, checking on factors crucial to home loan approval, such as if your bills are paid on time and what your credit score presently looks like. 

Your income can be one of the most critical factors to determine your final approved home loan amount. As such, you’ll need to provide payslip copies to lenders to assist them in assessing your income during the loan tenure, regardless of your employment status, full-time, part-time, or otherwise.

Casual employees will want to be casually employed for at least 12 months to be eligible for a home loan. Alternatively, you want to have worked as a permanent casual worker (working for a fixed number of hours per week) for at least one month, or you should have been in your current job for a minimum of three months (if the hours are irregular) to be eligible for the loan.

What is an investment loan?

An investment loan is a home loan that is taken out to purchase a property purely for investment purposes. This means that the purchaser will not be living in the property but will instead rent it out or simply retain it for purposes of capital growth.

Does UBank offer home loan pre-approvals?

If you’re applying for a home loan with UBank, you can first get an approval in principle. You’ll need to provide information about your job and earnings, your household expenses, the assets you own and the debts you owe. 

UBank will assign a home loan specialist to discuss these details over a phone call, which can take about 30 minutes. 

The bank will then confirm if you’ve received in-principle approval for your home loan. Depending on how you submit your documents, this could take a few days or a few weeks. If successful, the approval will be valid for 60 days. 

How do I apply for a home improvement loan?

When you want to renovate your home, you may need to take out a loan to cover the costs. You could apply for a home improvement loan, which is a personal loan that you use to cover the costs of your home renovations. There is no difference between applying for this type of home improvement loan and applying for a standard personal loan. It would be best to check and compare the features, fees and details of the loan before applying. 

Besides taking out a home improvement loan, you could also:

  1. Use the equity in your house: Equity is the difference between your property’s value and the amount you still owe on your home loan. You may be able to access this equity by refinancing your home loan and then using it to finance your home improvement.  Speak with your lender or a mortgage broker about accessing your equity.
  2. Utilise the redraw facility of your home loan: Check whether the existing home loan has a redraw facility. A redraw facility allows you to access additional funds you’ve repaid into your home loan. Some lenders offer this on variable rate home loans but not on fixed. If this option is available to you, contact your lender to discuss how to access it.
  3. Apply for a construction loan: A construction loan is typically used when constructing a new property but can also be used as a home renovation loan. You may find that a construction loan is a suitable option as it enables you to draw funds as your renovation project progresses. You can compare construction home loans online or speak to a mortgage broker about taking out such a loan.
  4. Look into government grants: Check whether there are any government grants offered when you need the funds and whether you qualify. Initiatives like the HomeBuilder Grant were offered by the Federal Government for a limited period until April 2021. They could help fund your renovations either in full or just partially.  

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.

Can I take a personal loan after a home loan?

Are you struggling to pay the deposit for your dream home? A personal loan can help you pay the deposit. The question that may arise in your mind is can I take a home loan after a personal loan, or can you take a personal loan at the same time as a home loan, as it is. The answer is that, yes, provided you can meet the general eligibility criteria for both a personal loan and a home loan, your application should be approved. Those eligibility criteria may include:

  • Higher-income to show repayment capability for both the loans
  • Clear credit history with no delays in bill payments or defaults on debts
  • Zero or minimal current outstanding debt
  • Some amount of savings
  • Proven rent history will be positively perceived by the lenders

A personal loan after or during a home loan may impact serviceability, however, as the numbers can seriously add up. Every loan you avail of increases your monthly installments and the amount you use to repay the personal loan will be considered to lower the money available for the repayment of your home loan.

As to whether you can get a personal loan after your home loan, the answer is a very likely "yes", though it does come with a caveat: as long as you can show sufficient income to repay both the loans on time, you should be able to get that personal loan approved. A personal loan can also help to improve your credit score showing financial discipline and responsibility, which may benefit you with more favorable terms for your home loan.

Why should I get an ING home loan pre-approval?

When you apply for an ING home loan pre-approval, you might be required to provide proof of employment and income, savings, as well as details on any on-going debts. The lender could also make a credit enquiry against your name. If you’re pre-approved, you will know how much money ING is willing to lend you. 

Please note, however, that a pre-approval is nothing more than an idea of your ability to borrow funds and is not the final approval. You should receive the home loan approval  only after finalising the property and submitting a formal loan application to the lender, ING. Additionally, a pre-approval does not stay valid indefinitely, since your financial circumstances and the home loan market could change overnight.

 

 

What is a draw down?

The transfer of money from a lending institution to a borrower. In a typical home loan, the funds are drawn down all at once in order to buy the property. In a construction loan, the money is drawn down in several stages to pay the builders as they progress through each phase of the project. In a line of credit loan, you can draw down money up to a limit based on your loan’s available equity.

What is equity? How can I use equity in my home loan?

Equity refers to the difference between what your property is worth and how much you owe on it. Essentially, it is the amount you have repaid on your home loan to date, although if your property has gone up in value it can sometimes be a lot more.

You can use the equity in your home loan to finance renovations on your existing property or as a deposit on an investment property. It can also be accessed for other investment opportunities or smaller purchases, such as a car or holiday, using a redraw facility.

Once you are over 65 you can even use the equity in your home loan as a source of income by taking out a reverse mortgage. This will let you access the equity in your loan in the form of regular payments which will be paid back to the bank following your death by selling your property. But like all financial products, it’s best to seek professional advice before you sign on the dotted line.