![\"couple\"](\"https:\/\/i0.wp.com\/www.realestate.com.au\/blog\/wp-content\/uploads\/2016\/08\/24102036\/couple_getty_article-1024x768.jpg?resize=1024%2C768&ssl=1\")
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Looking to buy a house<\/a> and get a loan? Here are a few issues you need to tackle before you take out a mortgage<\/a>. Picture: Getty<\/p>\n<\/div>\n For most Australians, a mortgage is the biggest financial commitment of their lives, so knowing what to ask before taking the plunge can be the difference between fiscal success and stress.<\/strong><\/p>\n John Tindall, a Choice Home Loans<\/a> mortgage broker in Wattle Grove, Sydney, shares the key questions all potential borrowers should ask before taking out a mortgage.<\/p>\n \u201cPeople understandably focus largely on how much they can borrow, without entering financial stress into the equation,\u201d Tindall says.<\/p>\n Calculators which estimate borrowing capacity are available online, but are often a \u201cone-size-fits-all\u201d assessment.\u201d<\/p>\n \u201cThey don\u2019t cover all scenarios, such as part-time or casual income and may not cover off the benefits and costs of lenders\u2019 mortgage insurance. For certainty, it\u2019s easy to apply for a pre-approved loan,\u201d Tindall says.<\/p>\n The comparison rate offered by a lender provides a guide to the actual cost of a loan, by reflecting for example, annual fees.<\/p>\n \u201cPeople should also ask for an estimate of the additional transaction costs, such as government charges, like stamp duty, lender fees and lenders\u2019 mortgage insurance. As a broker, I provide a \u201cmoney-in, money-out\u201d summary, so this is all very clear,\u201d he says.<\/p>\n Lenders\u2019 mortgage insurance is an insurance designed to protect the lender in case the borrower can\u2019t meet the loan repayments.<\/p>\n It\u2019s generally charged when the deposit is less than 20% of a property\u2019s purchase price.<\/p>\n The cost depends on the percentage of the value borrowed and the loan amount, but it varies between lenders<\/a>.<\/p>\n \u201cAlthough a potential additional cost, lenders\u2019 mortgage insurance can make the difference between getting the desired property and missing out,\u201d Tindall says.<\/p>\n These can include offset accounts, redraw facilities, branch versus online banking, additional repayments or the certainty of fixed rates.<\/p>\n \u201cLike a new car, what features you need or want needs to reflect what you want to do now\u00a0\u2013\u00a0and in the future. For example, redraw and offset facilities can be a great way to save up for a future holiday. You should discuss these with your broker or banker.\u201d<\/p>\n It\u2019s best to have at least a conditional approval before house-hunting, Tindall says.<\/p>\n \u201cDepending on loan volumes, some lenders can take twice the time to approve a deal than the normal cooling off period allows. If you need it quickly, be prepared to work quickly and collaboratively with your broker or banker.\u201d<\/p>\n First-timers should always ask about any\u00a0grants they may be eligible for, Tindall advises.<\/p>\n Funded by states and territories and administered under their own legislation, such grants make funds<\/a> available to first home buyers and are often coupled with savings on stamp duty.<\/p>\n \u201cThe eligibility for such grants is also often misunderstood, so do your research,\u201d he says.<\/p>\n <\/p>\n<\/div>\n Realestate.com.au <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"How much can I borrow?<\/h2>\n
This information is of a general nature and does not constitute professional advice. You should always seek professional advice in relation to your particular circumstances.<\/i><\/span><\/strong><\/h6>\n
What are the fees?<\/h2>\n
What is lenders\u2019 mortgage insurance and do I need it?<\/h2>\n
What features do I need?<\/h2>\n
How quickly can this be done?<\/h2>\n
Can I get a First Home Owner Grant?<\/h2>\n
This information is of a general nature and does not constitute professional advice. You should always seek professional advice in relation to your particular circumstances.<\/em><\/h5>\n