5 things you should know before applying for a mortgage

  1. Get a property report about the property you want to purchase, we can provide one to you free of charge.

  2. Know how much you can afford to borrow. Tip, Those websites with "see how much you can borrow" calculators are highly inaccurate.

  3. Know your credit rating, things are changing and their is a lot more reporting to the credit agencies than ever has been.

  4. Know exactly how much you earn and produce evidence, pay slips, profit and loss statements for self employed etc.

  5. Don't be stuck on a particular interest rate to begin with, sometimes, we need to get a loan using all of the current information we have at the point of application. Lets get the loan first then find ways to get a better interest rate.

A Property Report can give you confidence to make an informed decision

The Free report Contains

  • Photos of the property

  • The land Area and dimensions

  • Council area and title details

  • Estimated Value and Value range plus confidence score

  • History of property activity

  • Sales History

  • Recently Sold properties in the area

  • Current similar properties on the market

  • Similar properties to rent in the area

  • Insights into the suburb include numbers of properties sold and median price

  • Average days on the market

  • Median Values for units and rentals

Know how much you can afford to borrow

  • Know how much you can afford to borrow. Tip, Those websites with "see how much you can borrow" calculators are highly inaccurate. Every bank is different and what they allow as income will change from bank to bank. Some may not take overtime, bonuses or shift allowances into consideration, or may only allow a percentage of that income in the calculation. We can give you a better idea of your total available funds by booking an appointment where we can gather information about your income.

Know your credit rating

Know how much you earn

  • In most cases, you will need to be able to prove how much your earn and have evidence to back it up. Some loans, (Lo Doc Loans) don't require very much proof of income, but these loans are risky and much more expensive than applying for a loan where have have all of the necessary documentation. (Full Doc Loan) 

Interest Rates

0488 838 775

  • Don't be stuck on a particular interest rate to begin with, sometimes, we need to get a loan using all of the current information we have at the point of application. Lets get the loan first then find ways to get a better interest rate later. I agree that over the life of a loan, you might save up to $100,000 in interest between a low rate and high rate loan. There was a time in Australia when interest rates were very high. See the chart below.

In 1985, the average wage in Australia was approximately $19,000 and the average home cost $150,000. Cited

The interest rate almost double by 1990 to 17.5%. The home buyer might have waited until 2002, when the interest rates hit 6.5%? The repayments would have represented a large proportion of income by comparison, however, real house prices rose by about 180 per cent between 1970 and 2003. Cited

  • Know your credit rating! Things are changing and their is a lot more reporting to the credit agencies about you than ever has been in particular, the new comprehensive credit reporting and how it's changing your credit report

  • From February 2018, some banks will be putting additional information about the credit products you hold on your credit report which will give a more complete picture of your credit history.

  • However, these banks are only required to add this new information to your report from July 2018.

      

        The new information will include:
  

  • The type of credit products you have held in the last 2 years   

  • Your usual repayment amount   

  • How often you make your repayments and if you make them by the due date.

  • You may find that your credit score has changed as a result

  • You can find plenty of information regarding credit scores and credit reporting at the ASIC

  •   Money Smart website here

 
 

Check out how much you may be able to borrow

 

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References

(Abelson & Chung 2005)

​Abelson, P & Chung, D 2005, 'The real story of housing prices in Australia from 1970 to 2003', Australian Economic Review, vol. 38, no. 3, pp. 265-81.

http://www.econ.mq.edu.au/Econ_docs/research_papers2/2004_research_papers/Abelson_9_04.pdf

(Budget Direct 2018)

Budget Direct 2018, How Australian housing has changed over the years, viewed 18/09/2018 2018, <https://www.budgetdirect.com.au/blog/how-australian-housing-has-changed-over-the-years.html>.

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0488 852 884

  • Victoria Mortgages Commercial Loans

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