It is imperative to understand what your options are when it comes to taking out a mortgage. As this could have a big difference on what you could buy and/or on your repayments etc.
Some examples of differences at the moment:
· Commonwealth have drastically reduced their serviceability levels (basically how much they will lend).
- So for a family of 2 adults and 2 children with a $70k annual income the Commonwealth would lend around $220,000
- The same family could achieve around $285,000 with another Bank.
· ING have a potential way of reducing Lenders Mortgage Insurance (LMI) by paying a flat fee of $699 up to 85% Loan to Value Ratio (LVR) ie $340,000 mortgage on a $400,000 purchase price.
-Compare this to other lenders and their Lenders Mortgage Insurance (LMI) fee is anything between $2,600 and $4,300.
· Westpac have reduced their Loan to Value Ratios (LVR) for new customers down to 87% (LVR), some lenders still offer up to 95% LVR.
· 2 year Fixed rate Mortgages currently range somewhere between 6.99% and 7.69%.
· 5 year Fixed rate Mortgages currently range between 7.79% and 8.84%.
· Temporary residents generally can only borrow up to 80% (LVR), however it could be possible to borrow up to 90% with some Banks.
· Some Lenders will not offer people who are on a probation period in their jobs a mortgage, however some will.
· Some lenders offer mortgages with no application fee, the normal fee is around $600.
· Capped rates do exist here now but they are very rare, (this is where the interest rate can go down if rates reduce but will not go past a certain rate (a cap) when rates increase).
So just some examples of why it is important not just to talk to your Bank or take their say so and see what else is available.