How much can you borrow?

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Harry Hills

Fundfin went above and beyond to help secure a fantastic investment asset under a complex structured loan. They have allowed our family investment fund to be set up in great stead for the future passive income stream which is exactly what ...

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William Morris

Great experience with FundFin, very helpful, proactive and quick turnarounds in all our dealings, would definitely recommend them to friends and family.

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Caleb Sos

Fantastic result dealing with James. We had a complex structure and he dealt directly with our Accountant to plan and implement our Finance. Highly recommend.

Frequently Asked Questions

I've heard about an offset account. What is this and what's the difference between offset and redraw?

An offset account is a transactional account that sits against the loan. Any funds held in this account go to offsetting interest payable on the loan. For example, if your loan balance was $100,000 and you held $90,000 in your offset account, you would only be paying interest on $10,000. While the principal reduction repayments would remain the same, you would pay less interest over the life of the loan, thereby reducing the overall loan term saving you thousands or more! As with any everyday transactional account the funds are accessible at any time.

Generally if you are on a fixed rate loan you won't have access to an offset account however some lenders offer niche products that allow you to offset all or part of the fixed loan.

Redraw is where you make additional repayments above the minimum required as part of your loan contract. Some lenders allow you to draw on these additional repayments as required (sometimes for a fee) however this may impact on your loan balance and the interest payable.

I already have relationship with a lender. Why use a mortgage broker?

Mortgage brokers operate independently of any financial institution. We're not locked into any relationships with specific lenders and want you to have the most competitive option based on your own unique set of circumstances. There is no 'one fit' solution for any client and we aren't limited to one lender's suite of products.

Best of all - there is no cost to you to use our service!

Can I cash out the equity I've built up in my existing property?

Yes you can. It comes down to the purpose and use of funds, as dictated by the appropriate lending guidelines.

For example, residential loan cannot be used for business purposes and vice-versa. We can assist in determining what loan is most suitable for your circumstances.

I have a low deposit. Do I have to pay lenders mortgage insurance?

Not necessarily! Lenders Mortgage Insurance (LMI) is a premium charged by the lender's insurer for customers who need to borrow money above the maximum thresholds set by the insurer. Usually this is for loans above 80% loan to value ratio (LVR). However, some lenders offer LMI waivers for clients with certain professional qualifications up to 95% LVR, and other lenders may offer an alternate interest rate for customers with lower deposit without charging an LMI premium. There are also government backed first home buyer schemes which may allow for a deposit of 5%.

If you have any existing properties, you could also use the equity towards some or all of the deposit, including any associated costs such as stamp duty.

Some lenders also offer family pledge, or guarantor products where you can use the equity in a family member's home to borrow up to 100% of the purchase price plus costs.

My borrowing power is X and my repayments are Y. I know I could easily afford more than that per month!

Borrowing power is determinant on several factors. These can be a combination of, but are not limited to;

The lender
Your income (including rental income, pensions or super annuities, and government payments)
Your existing liabilities, such as credit cards, personal loans and HECS debts
Your monthly living expenses, fixed and discretionary

Lenders stress test the ability to afford loan repayments by running the loans against a floor rate, which is usually a couple of percentage points above the current market rate. This is to safeguard you in the event that if interest rates were to rise, you could still afford to make your repayments without experiencing significant hardship. Some lenders' floor rates are higher than others, meaning that you may be able to borrow more with Lender A than Lender B.

Existing debts, such as credit cards will also have an impact on how much you can borrow. While a $10,000 credit card might not seem like a lot in the scheme of things, it could be the difference of tens of thousands of additional borrowings on your home loan! This is where we can guide you to find the right options to suit your circumstances.

I'm a first home buyer, can you help?

Absolutely - we can guide you through the entire process, from how much you can borrow, to first home buyers concession eligibility, putting you in touch with conveyancers and much, much more!

I've heard some lenders are offering rebates to clients refinancing. Can you help with this?

Absolutely, however it is important to note about what your goal actually is. For the sake of a few thousand dollars is it worth paying a few basis points more where any cash gain you have made will be eroded by the additional interest you're paying. If you have entered in to a longer loan contract, then you will likely end up paying more interest over the life of the loan, even if your initial rate is lower than what you were on.

Many lenders are offering rebates between $1000 and $4000 and some of these multiply per property refinance. We can discuss these options with you in your initial enquiry.

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