First Home Buyer Questions

What is the comparison rate on a home loan?

The comparison interest rate includes the cost of any loan fees and charges. Lenders in Australia are legally required to provide you with the comparison rate on their products before you take out a loan.

What is a honeymoon home loan interest rate?

A honeymoon interest rate is a lower rate for first period of your home loan (usually the first 6 or 12 months).

What is a fixed interest rate?

A fixed interest rate on a home loan stays the same for a defined period (usually one to five years). If market interest rates change during that time, the fixed interest rate on a home loan (and the repayments) will stay the same.

What is a variable interest rate?

A variable interest rate on a home loan can move up or down based on market interest rate movements. If rates decrease, repayments will decrease. If rates increase, repayments will increase.

What is a split home loan?

A split loan has a portion of the loan with a fixed interest rate and a portion with a variable interest rate.

What is an offset account?

An offset account allows you to reduce the amount of interest you pay on your home loan account.

What is a redraw facility?

A redraw facility allows you to access the equity that you build up in your home over time if you need to borrow additional funds.

How long is the average home loan term?

25 or 30 years, though you can get home loans for shorter terms.

How much can I afford to borrow?

That depends on the criteria of the lender and their assessment of your ability to make your home loan repayments. Lenders in Australia are legally required to lend responsibly.

What will my home loan repayments be?

That depends on the amount you borrow, the loan term, the interest rate and any other loan fees or charges.

How much is the First Home Owner Grant in Victoria?

The First Home Owner Grant in the Victorian metropolitan area is $10,000 if you’re buying or building a new home and you meet the other eligibility requirements. It is $20,000 in regional Victoria up until 30 June 2020.

Can you get the First Home Owner Grant if you’re buying an established home?

No, you must be buying a new home.

How do you apply for the First Home Owner Grant in Victoria?

You can apply for the First Home Owner Grant in Victoria online through the State Revenue Office.

Am I eligible for the stamp duty exemption or concession if I receive the Victorian First Home Owner Grant?

Yes, you’ll be eligible for a stamp duty exemption (if it’s valued below $600,000) or a reduction if it’s valued between $600,000 and $750,000.

Am I eligible for the stamp duty exemption or concession if I buy an established home?

Yes, provided that your home falls within the values outlined in the answer to the question above.

Can I use my super to buy my first home?

Yes, but only if you take advantage of the federal government’s First Home Super Saver (FHSS) Scheme. It’s possible to withdraw up to $30,000 worth of your voluntary contributions for a deposit on a home.

What is lenders’ mortgage insurance (LMI)?

Lenders’ mortgage insurance protects lenders if borrowers default on their repayments. Most lenders will require you to take out LMI if your deposit is less than 20% of the value of your home.

What is the First Home Loan Deposit Scheme?

The First Home Loan Deposit Scheme[JC1]  is a federal government guarantee to help you avoid the cost of lenders’ mortgage insurance (LMI). The cost of LMI varies between lenders, but it can be $10,000 or more on an average home loan.

Can you participate in the First Home Loan Deposit Scheme if you’re eligible for the First Home Owner Grant?

Yes, provided that you satisfy the eligibility requirements of the First Home Loan Deposit Scheme as well.

How we can help

At ARG Finance, our experienced team of mortgage brokers can answer any other home loan questions that you might have. Contact us today!