First home buyer FAQs - Made For You Finance

Buying a house is a process that can be really stressful and many questions we will comes up .

Here some of the most common questions

Call us to discuss your questions in more detail 

What can I afford to buy?

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How much deposit do I need?

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What count toward the loan deposit?

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What is home loan guarantor?

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What is LMI?

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How much does LMI cost?

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How can I avoid the pay LMI?

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How do I find a good property?

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What is the First Home Owners Grant?

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What is pre-approval?

This is simply an indication of your ability to borrow. You may choose to seek a pre-approval at any time to understand your borrowing capacity, but it is not a guarantee of funding or a mortgage offer. Our obligation-free assessment can help you understand your ability to borrow.

What's the difference between a fixed rate and a variable rate?

A variable rate can change anytime and will affect your regular repayments.

A fixed rate has been set at a certain rate, so it stays the same for the entire fixed rate period. This means that your repayments also stay the same for the same ‘fixed’ period. As the borrower you can generally choose a fixed period between 1 to 5 years. Your lender may charge you fees to break your loan from the fixed term.

With a variable rate loan the borrower has the ability to repay extra but this isn’t necessarily the case with a fixed loan.

What's the difference between principal & interest and interest only repayments?

A variable rate can change anytime and will affect your regular repayments.

Principal and interest are when you pay a portion of the loan balance in addition to the interest charged over an agreed period. This is to ensure the loan is paid back over the term of the mortgage. Loan repayments will include part of the loan and part of the interest on the loan.

Interest only is when you’re paying the interest of the balance with no principal over an agreed period.

What is redraw?

If your mortgage type allows you may be able to make additional payments to your mortgage, over and above the amount that you need to pay and have already paid into your mortgage. This means that there may be additional money that you can redraw from your mortgage. Depending on the terms of your loan, your lender may allow you to withdraw the extra funds paid into the account.

What is an offset account?

An offset account is a transaction account linked to your mortgage, where cash in your transaction (offset) account reduces the amount of interest payable in your mortgage account. This helps you pay off your home loan quicker.

What is the difference between offset and redraw?

Redraw is when you make additional payments above the minimum amount into your mortgage in order to reduce the interest calculated. If the lender allows, these extra payments can be accessed, or drawn on at any time. However this will impact the balance of your mortgage and interest payable. Offset is when you hold these additional payments in a separate transaction account, you aren’t reducing the balance of the loan but you’re still getting interest reductions through the offset.

What is a line of credit loan?

It is a flexible loan allowing you to draw down and repay smaller and larger sums at any time up to the approved limit. These loans have an agreed term and repayments are interest only based on the amount you have drawn down at the time.

How long does settlement usually take?

The time between exchanging contracts and settlement varies. Four to eight weeks is normal. Settlement time is negotiated between buyer/seller and can be affected by the lender and buyers ability to complete requirements prior to settlement.

Everyday we help clients with their loan and finance needs.

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