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1. What is the difference between a Fixed and variable
Interest Rate?
Variable Rate: Your interest rate will vary throughout your
loan term. It can go up and down at different times. In most
cases your rate will change following a change by the
Reserve Bank e.g. if your current rate is 7.25% and the
Reserve Bank increase's rates by 0.25% your rate will
increase to 7.50%. It is the same process if the Reserve
Bank reduces interest rates your interest rate will in turn
reduce. The advantage of this option is that at the
beginning of your loan the rate is usually lower than a
fixed rate option and offers more flexibility eg. additional
repayments.
Fixed Rate: Your interest rate is set for a specific term.
If the Reserve Bank changes interest rates your rate will
remain the same and not increase or decrease. Your fixed
rate term is generally between 1-10 years. Once your term is
completed your interest rate will change to variable however
you may have the option to re fix for another period if you
wish. The advantage of this option is you have a set
repayment that will not change while you are in your fixed
term.
2. What is the difference between Principle and Interest and
Interest Only repayments?
Principle and Interest: This is a two part repayment. One
part of the repayment (being principle) reduces your loan
balance while the other part (being interest) is simply the
portion that is paid to the funder for borrowing the money.
Interest Only: This is a one part repayment to pay the
lender the fee (interest) for borrowing the money. In this
payment there is no reduction of your loan balance. Your
balance remains the same during your interest only term. An
interest only term is set for a period of usually between
1-5 years with the option to extend this period after this
time, if agreed by the lender. An interest only option
generally is best suited for investment property loans,
where reducing the loan balance is not desired.
3. How do I know if I am getting a good deal?
It is best to discuss in detail with your mortgage
broker why he or she has recommended a particular lender.
You want to ensure adequate research has been done on your
behalf. Here at the Edge Home Loans we will do this by
giving you up to date information on what is being offered
out there at the time. Our focus is to ensure the loan is
correctly tailored to our client - saving our client money
where ever possible.
4. Do you
charge a Brokerage Fee?
NO! We are paid by the lender or credit provider the
loan is placed with. The Edge Home Loans does not believe in
then charging the borrower a brokerage fee. We are here to
save you money not waste your money!
5. What Fees
will I be charged?
Individual Lenders or Credit Providers charge different
fees to establish a loan. Once a decision has been made as to the best loan for you, your
consultant will provide you with a list of expected fees and
charges both from the lender and government charges.
6. Can you tell me what to expect once I have completed an
application form.
Yes. An expected process timeline has been prepared and
available on our website now - please
click here.
7. Will you process the First Home Owners Grant (FHOG) on my
behalf?
Yes. Novasure Pty Ltd being the originator used
primarily by The Edge Home Loans acts as an Agent for The
Office Of State Revenue - this will enable your funds to be
available on settlement.
This may vary if the loan is outsourced to a Lender whom is
not an Agent however, as your broker The Edge Home Loans will
arrange for this to be processed via your solicitor or
conveyancer.
8.
What can I do to make the process faster?
The Edge Home loans has provided on our website a
checklist of documentation required when processing a loan
application. The sooner this documentation is provided in
full the faster we can have you approval.
Also, once your documents have been received by you or your
solicitor or conveyancer it would help to ensure they are
returned promptly, signed and completed correctly with all
outstanding information provided. The Edge Home Loans is
here to help ensure this process all runs smoothly for you
and will be here to assist should it be needed.
9.
What happens if I decide not to proceed?
If you have received a conditional approval letter and
decide not to proceed there is no charge to you.
If a valuation has been completed - an administration and
valuation charge of $300.00 will apply.
If a formal approval has been issued - an application fee of
$660.00 is payable
If solicitors have been engage for the lender a legal fee
will apply of between $100.00 - $440.00 plus an application
fee $660.00.
If settlement has been booked and cancelled a further
$100.00 approximately will be charge.
Please note the above fees quoted are indicative only and
may change depending on the lender and lenders solicitor
used
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