What to do before you apply

There are a few admin ideas that are good

  • Get all your tax returns done prior to apply – often banks will want to see these
    Check your credit card expenses/statements – make sure you note and big ‘one-off’ spends, and make sure you aren’t behind on payments
    Do the math – Add up stamp duty, potential loan application fees, and lenders mortgage insurance premiums and add these to the property price.
    Calculate Upfront costs, like building inspection reports, solicitor or conveyancing costs will need to be ‘out of pocket’ – make sure you factor those in
    Make a spreadsheet to compare loans, we use the following as they are all disclosed by lenders
  • the amount of money you are borrowing
  • the annual percentage interest rate
  • how the interest is calculated and when it is charged
  • the credit fees and charges to be paid or how they will be calculated
    how they will inform you of changes affecting interest rates and fees or charges.

We always recommend you complete a ‘pre-checklist’ – so you give all banks and brokers the same information

  • married, defacto or single?
  • How many dependents?
  • Gross annual income?
  • self-employed or PAYG)
  • Commision, bonuses or overtime?
  • Rental income?
  • Centrelink income?
  • Current limit on the credit cards
  • other debts?

 

Lenders Mortgage Insurance

Banks generally only lend up to around 80 percent of the property’s value. without┬áLenders Mortgage Insurance (LMI).

The bank must tell you the cost (it will differ from lender to lender) It is a one-off payment added to your home loan. You will be paying interest on this, so examine the cost.

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