Help & FAQs
- How long does a Pre Approval last for?
- What happens once the Pre Approval expires?
- Is it possible to purchase a property under my Company name? I would also want my loan to be the Company Name.
- I am a First Home Buyer who does not have any savings. Can I take out a loan to cover 100% finance?
- I have been self employed for 3 years, but find it hard to prove my income. I still want a loan which offers me a competitive rate and flexible loan benefits. Is this possible?
- What does a finance broker do?
- I am looking to buy a property and my parents already have a property, but with my savings alone I would need to borrow over 80%. I want to avoid paying a huge mortgage insurance fee. How can this be done?
- How long does it take for my finance to go through?
- How much is it going to cost me to go through a broker?
- I am looking to refinance my loan, however all the banks I have approached have given me similar rates. If I go through Touch of Finance, can you obtain better rates then the banks have offered?
- What is the application process?
- Why choose a Broker and not a bank?
- How much can i borrow?
- Do I need a loan approval before I buy a property?
- What is Lenders Mortgage Insurance (LMI)?
- What is stamp duty?
- What is the difference between a fixed rate loan and a variable rate loan?
- What is a comparison rate?
What happens once the Pre Approval expires?
If for some reason you haven't found a property or you need extra time to work things out, we can ask for a further 6 months extension from the lender. The bank will need to be provided with updated evidence of income and savings
Is it possible to purchase a property under my Company name? I would also want my loan to be the Company Name.
Borrowing in a Company or Business entity is allowed for the purchase of a home or to invest in residential property. The Directors of the Company/Business need to go Guarantor for the loan and the loan can be set up in the Company name providing the title of the property is also in the Company name.
I am a First Home Buyer who does not have any savings. Can I take out a loan to cover 100% finance?
100% finance is available. Some lenders now offer customers with no savings the ability to borrow 100% of their purchase price.
If you are a First Home Buyer, the grant will go towards assisting you paying your government fees applicable with the purchase, however if you are not a First Home Buyer, all you need to do is confirm that you have the funds to cover the purchase fees involved. No savings history is required.
I have been self employed for 3 years, but find it hard to prove my income. I still want a loan which offers me a competitive rate and flexible loan benefits. Is this possible?
Yes, it is possible. With many people now working for themselves, lenders have released their barriers and introduced a range of products to suit their needs. LOW DOC or NO DOC products have been designed to cater for self employed people who find it difficult to prove their income. Many lenders have Income declarations for borrowers to sign rather than providing their tax returns. The lenders have in recent times enhanced these products to offer a similar if not the same interest rates that apply for normal loans, with flexible loan benefits such as redraw and 100% mortgage offset.
What does a finance broker do?
A finance broker has access to a variety of financial institutions and providers. It is important for the broker to understand the clients' financial needs and position to select the product and best deal that is right for you
I am looking to buy a property and my parents already have a property, but with my savings alone I would need to borrow over 80%. I want to avoid paying a huge mortgage insurance fee. How can this be done?
This can be done though a ‘Family Pledge or Family Guarantee’ Loan. Lenders offer Family pledge loans to buyers who either do not have enough savings, no genuine savings or do not want to pay huge Mortgage Insurance premiums to cover their own purchase.
Through Family Pledge loans, buyers are allowed to use the equity in certain family member’s property as additional security to assist with the new purchase. This can reduce or eliminate the need for Mortgage Insurance.
How long does it take for my finance to go through?
Depending on the lender and type of loan, it could take up to 3 days for a conditional approval.
How much is it going to cost me to go through a broker?
We do not charge a brokerage fee. Commission is paid by a lender. This doesn't increase the interest rate or fees charged by the lender. The commissions payable by lenders cover the cost associated with our services so there is no need to charge any additional fees.
I am looking to refinance my loan, however all the banks I have approached have given me similar rates. If I go through Touch of Finance, can you obtain better rates then the banks have offered?
Banks are sometimes restricted with what they can offer their customers as they can only offer their own products. However as a recognized broker firm, Touch of Finance can obtain for our clients better rates than the branch’s can. There are many special rates and products only offered to brokers and we can even seek to request certain discounts from our wide range of lending panel.
What is the application process?
Interview between the broker and you. Sign an application for the lender with supporting documents such as: ID, contract of sale etc. Application will be submitted to the lender and they will proceed with credit checks. Once the lender assesses the application they will advise that the application is filled in correctly. You will be informed and they may require additional information. The lender organizes a valuation on the property followed by a report. (A decision will need to be made if the valuation is lower than estimated.) If mortgage insurance is not required, the lender will issue a full approval. If mortgage insurance is required, the file will need to be signed off with the insurer. Once insurer is happy with the application and has all satisfactory requirements, the loan is fully approved. The bank will send contracts for you to sign. Once signed we will send them bank to the bank and they will organize a settlement or funding date.
Why choose a Broker and not a bank?
As a Broker deals with several banks and not just one bank you have a variety of choices of products to choose from. When you are dealing with just the one bank you will obviously be limited with your choices. Brokers offer pretty much the same products as banks but they are all available in the one place.
It will depend on your financial position. Different lenders have different methods of calculating your borrowing capacity. As mentioned, it is important to understand your needs so that we can offer the right product to suit you.
Do I need a loan approval before I buy a property?
We strongly advise that before searching for a property a Pre Approval should be done. This is also called an AIP (approval in principal). The Pre Approval can tell you what you can afford and therefore what your price range will be
What is Lenders Mortgage Insurance (LMI)?
LMI protects lenders against a loss should a borrower default on their loan. If the security property is required to be sold as a result of the default, the funds recieved may not cover the full balance outstanding. In this case the lender is able to make an insurance claim, hence Lenders Mortgage Insurance.
Stamp Duty is a State Government Tax paid by the purchaser of real estate, depending on the price of the property. First Home Buyers may be exempt from Stamp Duty or be entitled to a rebate such as the First Home Buyers Grant.
What is the difference between a fixed rate loan and a variable rate loan?
A fixed rate loan is where the interest reamains the same for a set period of time. Once this period finishes it reverts back to variable rate. Variable rate loan is where the interest rate goes up or down according to the market rates.
A comparison rate expresses some of the costs involved in the loan, into a single interest rate. The aim of the comparison rate is to help consumers make more informed decisions when assessing the total costs of the loan.