Depending on your home loan needs and property purchase goals, we have a mortgage broker ready to assist you!
If you are seeking a home loan for:
- your first home
- an investment property loan
- upsizing or downsizing
- looking to refinance to save on interest repayments
- need to extract equity for personal or construction use
- consolidate debt or apply for a construction loan
- purchasing through your family trust
Fordable can assist with your home loan finance requirements.
What if my circumstances are unique?
There are a range of lenders with different policy and different niches. For example, the big four banks are quite flexible with policy but may not have the most competitive rates. The second tier lenders have tighter policy but offer more competitive rates. Then you have your third tier specialist lenders who will take on much more risk and charge higher rates for that service.
Understanding your circumstances and situation will assist your Mortgage Broker find the most suitable lender whose policy will accept your application. It's important to realise that low interest rates are not always available for every application as the personal circumstances of the applicants will dictate which lender products are suitable.
What’s happening with interest rates?
Currently owner occupier home loans interest rates are generally lower than investment home loan interest rates. In addition to this, if you are selecting principal and interest rates, again these are generally lower than interest only rates.
Adding to this layer of complexity with interest rate offerings, most lender have more competitive fixed term interest rates than variable interest rates. So having an in depth discussion with your Mortgage Broker is essential to help you navigate this landscape and select the home loan products which are most suitable to you.
Has applying for a home loan changed?
The home loan application process itself hasn’t changed much, being that the borrower speaks with a mortgage broker, the broker checks borrowing capacity and ability to service the loan and if there is a pass, application submitted and loan docs issued.
Where the real changed occurred is related to a reasonable increase in the amount of paperwork and compliance for the mortgage broker, and lenders are assessing applications more stringently. They are pulling apart bank statements and credit card transactions to ensure due diligence on all transactions occurs as part of their audit practices.
If you have been monitoring the home loan space for the last couple of years (2017-2019) then you would likely have heard about the Royal Commission and how hard it became to get finance. When the regulators stepped in and forced lenders to change their policy, it did impact borrowing capacity for applicants with the increased buffers around servicing existing debt, servicing new debt, living expenses thresholds and assessment rates.
Due to these changes, applicants could not get the same finance they could say back in 2015. This is where the sentiment of "it's hard to get finance" comes from in our experience.
The above changes hasn’t stopped people from successfully applying for home loans, if anything it’s improved the process as responsible lending practices are the highest priority which means loans are approved for people who can afford it. Applicants are assessed in a way which it should have been happening for a lot longer.
How should I proceed from here?
If you are thinking of buying a property or would like to see what rates are available then it’s essential you speak with a professional Mortgage Broker. They look at a range of lenders, they know the current market and best practice for preparing an application.
For example, we recommend that buyers seek pre-approval for a home loan before they start to negotiate on a property. Seems logical to most however we see a lot of people coming to us who have negotiated on a property, had an offer accepted and do not have finance approved. What does this mean? The broker normally has very little time to work on an application, the lender is pushed to assess and approve an application (currently impossible to get lenders to hurry up), the client is stressed after realising they may not get finance before a cooling off period expires and it all becomes a big headache. For more information about the pre-approval process, click here.
Once you have your finance pre-approved and find the property you want to buy, knowing the best way to negotiate and the process to follow for a purchase is going to ensure you have the most favorable outcome possible. We have buyers agents who can assist you and do all the negotiations, or represent you at auction.
With your pre-approval in place, if you successfully negotiate or purchase the property at auction, you will need to get a property valuation done and generally a few other requirements before the lender will confirm formal (or unconditional) approval.
This is the general process of applying for a home loan for all residential properties whether it be a loan for an investment property or owner occupied property. Refinance loans are a little more simple as you do not have the buying process involved, however the application process is the same.
To submit an enquiry and discuss your finance needs with our team, please complete our contact us form and a representative will be in contact with you shortly.