Finance FAQs, Melbourne, Melcorp Finance

Why use a mortgage broker?

A mortgage broker navigates the banking world for property buyers. Mortgage brokers are effective because they work for you – applying expert knowledge and leveraging professional networks and relationships with multiple providers. That’s how they are able to find the best possible loan for your unique needs and circumstances.

Why use Melcorp Finance?

Melcorp Finance offers personal service and expert guidance, assisting property buyers of all types. We work for you and are driven to get you the best deal possible.

We’re local experts who are focused on Melbourne – and we’re committed to achieving goals for those who seek to buy here.

What’s the difference between fixed rate and variable rate property loans?

Fixed Rate: with this type of home loan, interest rates and repayments remain the same for a period of time agreed upon before the mortgage is finalised. The loan reverts to a variable rate at the end of this agreed upon time.

Variable Rate: the interest rate on this type of property loan can fluctuate alongside changes in the RBA.

How much can I borrow for a home loan?

The amount you can borrow for a loan depends on multiple factors., The matrix for borrowing capacity varies from bank to bank – so if you want to buy that dream at the top end of your budget, speak to one of our brokers who can recommend where to get the best deal for your needs.

Two key areas assessed are:

Income: To lenders, this is a primary aspect of your situation when deciding on how much you can borrow. You must be able to cover repayments – accounting for potential interest rate changes – while meeting your living costs.
Financial commitments: Loan providers will take your current debts and monetary engagements into account in order to make an informed decision about your loan.

Our mortgage brokers understand the loan approval process and work closely with you to assess your situation, finding ways to ensure you can achieve your goals. We will help determine all of the features that make up your best loan option, including the amount.

Use our calculator for a quick idea of what you may be able to borrow – and for an in-depth approach that includes variations between banks, contact our brokers today.

Can I get a home loan if I’m self-employed?

Yes. There are options for those who are self-employed, which vary from bank to bank and relate to factors such as your income and the age of your business. A broker will use documents such as tax returns to verify your borrowing capacity is in compliance with the policies of multiple banks.

How can I pay off my home loan faster?

Our mortgage brokers will advise you on how to pay your loan off faster, where bankers will keep you in your loan for longer. Property loans come with terms and conditions – and these can include fees for early repayment. If rapid repayment is your goal, it’s important to get a loan that allows you to achieve it.

In general, a few basic concepts for fast repayments are:

Increasing the amount of your regular repayment
Making additional lump sum payments
Utilising a mortgage offset account to reduce interest

Investment

First Home Buyer

New Home Loan

Overseas Investor

Super Loan

Commercial Loan

Vehicle Finance

Debt Consolidation

What does FHOG mean?

FHOG stands for First Home Owner’s Grant. The FHOG is a federal scheme that is administered – and funded – by individual states

Am I eligible for the first home owner’s grant?

Eligibility for the First Home Owner’s Grant depends on multiple factors. As legislation can change over time and requirements can vary depending on area, always be sure to check the appropriate official government websites for your region – or contact Melcorp Finance directly to find out the current requirements.

For Victoria:

At least one applicant must be 18 years of age or older (discretionary)
At least one applicant must be an Australian citizen or permanent resident
At least one applicant must intend to live in the home as their principle residence for at least 12 months
Applicants must not have received the FHOG before
Applicants must not have owned a home or other residential property before 1^st of July 2000
Applicants must not have occupied a home continuously for 6 months that they owned or partially owned after 1^st of July 2000.
The home must be valued at $750,000.00 or less
The home must not be a holiday house or investment property

Note: this guide does not constitute a determination of eligibility by the State Revenue Office

I’ve never owned a property and neither has my partner – are we eligible for two FHOG grants?

No, if both parties wish to have their names on the title of the property. Although both parties must qualify for the First Home Owner’s grant in order to receive it, only 1 grant is given for a property purchase.

How much of a deposit do I need?

Your required deposit will vary from bank to bank, and our mortgage broker can advise the right fit for your needs. Typically, your deposit will be between 5% and 20% of the home’s purchase price.

What if I have a low deposit?

With less than 20%, you may be required to pay Lenders Mortgage Insurance (LMI) premium. You also may be able to use a family member as a guarantor, leveraging their property for your loan.

Everyone has a unique set of circumstances and financial attributes. It’s important to have your broker compare the lenders with lower LMI premiums.

Discuss your options with one of our experienced mortgage brokers to find the best option for your circumstances.

What is LVR?

LVR stands for Loan to Value Ratio. This is the percentage of money you’re borrowing for your home loan compared to the property’s value.

What is home loan refinancing?

Refinancing is a process that allows you to change your current home loan to a new home loan with a better provider. There are a number of reasons why you may want to change your loan.

We provide free financial health checks to help you determine if refinancing is beneficial to your needs.

Why do people refinance property loans?

There are many reasons to refinance your home loan, such as:

Saving money: You may be able to save money by obtaining a better rate
Renovations: covering costs related to improvements and additions
Debt management: Taking high interest rate loans such as credit cards to a more manageable platform
Switching rate types: You may want to switch from a variable to a fixed rate
Buying a new car: You can roll your car loan into your home loan

What do I need to think about when refinancing?

We will consider your reasons and situation when refinancing to make sure it truly fits your needs. There are many things to consider, so it’s a choice best informed by a holistic outlook on your finances via the guidance of a financial export.

What is stamp duty?

Stamp duty is a tax paid on certain assets such as homes. It is required by state and territory governments. Stamp duty varies by region, and also by property size.

In Victoria, stamp duty is calculated based on the value of the property and the purpose of its purchase – residential or investment.

As Stamp duty rates and rules are subject to change, always check the State Revenue Office of Victoria for the most current information.

What is a building and pest inspection?

When buying a home, building and pest inspections will generally cost around $500 - $1000 and are performed to provide an assurance of quality before you purchase. Although it’s an added expense, it’s one that ensures you know exactly what you’re buying.

Building and pest inspections generally don’t directly apply to apartments, but you can speak to your solicitor about entering a building & pest inspection clause into a contract as an optional safety net.

What is land tax?

Land tax is tax paid on property, specifically land, and varies by state. In Victoria, property used as a principal place of residence may be exempt from land tax.

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