A fixed rate means that the interest rate does not change over a period of time (either a set number of years or over the course of the entire loan). This means that your repayments also, will not change. This option can give you a greater sense of knowing and expectation when creating your budgets.

A variable rate means that the interest rate can fluctuate and can therefore change the amount of your loan repayments. For example if the interest rate goes down, so will your required loan repayment and vice-versa. This option will pass on to you, the borrower, any risk of rate change. It will allow the borrower to capitalise and gain when the rate is lower which can help you to pay your loan off quicker.

Today we have so many options it's hard to know what to do. How do you know if a bank, first, second or third tier lender actually suits you best?

Each loan scenario is different, and every bank and lending institution will constantly change and develop their loan offers. Therefore based on the needs of each single loan, Brooke conducts an analysis and compares product offerings from different types of lenders. The most appropriate lender/s become apparent and the most trusted lenders are recommended.

Bridging Finance:

A loan to ‘bridge’ the gap between buying your new home and selling your old home. It can be used to cover the purchase price and stamp duties while you await the settlement of funds from the property or investment in which you are selling.

Equity:

Equity is the difference between what your home is worth in the current market and how much money you owe on your home. For example, if your home is worth $600,000 and you owe $400,000 against it. Then you have $200,000 in home equity.

First Home Owners Grant (FHOG):

The first home owners grant is government financial assistance which may be available to you in your purchase. There are also first home owner reductions to stamp duty available which you may be entitled to. Brooke Yoxon Money Solutions Pty Ltd will be able to advise you if you are eligible.

Fixed Rate:

This means that the interest rate is fixed and will not change for the fixed rate period. The fixed rate period might be a number of years or it may be for the life of the loan.

Interest Only:

This type of loan requires the borrower to pay only the amount of interest on the borrowed money for either a set period of time or until the property is sold. An interest only loan would either require the borrower to repay the principal of the loan in one lump sum payment or it could be initially set up to revert to a principal and interest loan after a set period of time.

Mortgage Offset:

Mortgage Offset: This term refers to a feature where the money available from one nominated and linked savings or everyday bank account is ‘offset’ against your loan balance. In essence, whilst you still have access to your savings for every day that your savings remains in your linked offset account it is treated as a reduction to your loan balance when calculating the interest cost. Effectively this will reduce the amount of interest you pay on the loan (which consequently increases the amount of principle you pay in the loan and increase your equity). As with any loan feature, the fee (of any) associated to having the feature need to be carefully considered. This consideration will form part of Brooke Yoxon Money Solutions Pty Ltd recommendation to you.

Principal and Interest:

In this type of loan, the repayments are designed to pay the interest and to pay part of the principal. Therefore after every loan repayment the total amount owing on your property will reduce and you will gain equity in your home.

Redraw:

This feature allows the borrower to pay additional money into the loan when available and conversely will allow the borrower to withdraw the additional monies paid into the loan if and when needed. There will be some costs and rules surrounding the re-draw. For example there might be a minimum and/or maximum amount allowed on each re-draw and a limit of one re-draw allowed per day. Essentially re-draw is a feature that will allow a borrower to reduce the life of the loan as well as the interest paid on the loan by making additional payments or storing excess funds in the loan rather than their savings account.

Refinancing:

Refinancing is a term used when breaking your current mortgage to swap to another mortgage. This should be considered if and when there is a loan offering that better suits your needs or offers a better interest rate.

Settlement:

Settlement is the official exchange of contracts, titles and money between the parties involved in the sale. The settlement date is a date mutually agreed upon between the buyer and seller and is included in the contract of sale.

Split Loan:

A split loan refers to the single loan which splits the application of interest to both fixed rate and variable. An example of a split loan would be to have 50% fixed rate and 50% variable rate.

Stamp Duty:

This is a government charge applied to the transfer of property. There are some exemptions and reductions available to stamp duty. Brooke Yoxon Money Solutions Pty Ltd will access your eligibility for exemptions and reductions.

Variable Rate:

This means that the interest rate is subject to change throughout the period of the loan. The rate changes will occur in line with the official interest rates which are set quarterly by the Reserve Bank of Australia.

Your individual check list when buying a property will vary but here a few things to consider when going through this process. This is intended as a guide only and not a complete list.

Location

• How will you get to work/school/family etc.. from the new property and how long will it take?
• Access to the public transport network
• School zones
• Are there any planned community projects that may increase your property's appeal?

Property type

• Do you want a flat, townhouse or a house?
• Do you need a backyard?
• Will this property suit your needs now and in the future?
• Do you have a strong preference to fixed property feature and/or structure? i.e. brick vs weatherboard.

Property Features

• How many bedrooms, bathrooms and car space or street parking do you require?
• Does the property have adequate heating, cooling etc.. or should you factor in a cost of upgrading these yourself?
• Is the property under builder's warranty?
• Have you had a building inspection?

Price plus costs

• Have you considered all the additional costs of buying? Stamp duty, moving costs, connection fees? Don’t forget to add these into your budget.
• Know how much you can afford and what you are prepared to spend and then look and compare properties in this range. Contact Brooke for a friendly chat and set up a meeting so you understand what repayments could cost you under different scenarios.

If buying at auction, did you get your finance pre-arranged. Contact Brooke at least a month before attending an auction you intend to bid on.

If making an offer to purchase, make sure you read 'Things to ask and consider when making an offer to buy a property' first.

Your individual check list when making an offer to purchase a property will vary but here a few things to consider when going through the process. This is intended as a guide only and not a complete list.

• Do you know what name/s the property is to be purchased in? If you are not 100% sure, you could use your name and then immediately add the words ‘and/or nominee’ in the offer document.
• How long do you want settlement to be? Settlement is generally 60 or 90 days, however there is no fixed number of days so consider what length of settlement will suit you. You will need to consider factors such as what day you need to move out of your existing place, or do you need to give a minimum amount of notice, do you require a loan and how long will this take to arrange?
• Do you require any finance to purchase the property? If you do always include the term ‘subject to finance’ in your offer.
• Do you know who you want to obtain finance from? If you have already seen me and know exactly which loan you will be applying for, you can tighten up the finance clause by including the term ‘subject to finance from …..(use the name of your preferred lender)’
• Do you want a building inspection carried out? If so insert the term ‘subject to building and termite inspection’ A building inspection costs money so you don’t want to arrange and pay for this if your offer is not accepted by the vendor.
• Do you have any other special requirements? If you do, add them into the offer of purchase, these could include things such as, ‘vacant possession’ if for example there is a tenant in the house you want vacated before you move in. Or there could be a specific fixture, fitting or item that you want to nominate as part of the sale – for example the existing fridge might fit perfectly into a custombuilt fridge space and your fridge does not. In this case, nominate the fridge as part of the sale.

This checklist was made for a typical residential property and is intended as a guide only. The settlement of your specific property will have its own unique demands. This is not an inclusive list of all settlement requirements but rather an outline of what to expect.

• • Select a conveyancer and provide them with the section 32, sale contract and any further documents relevant to your purchase
  • Contract of Sale has been signed by the seller
  • The deposit has been paid to the real estate agent (by the due date) and you have a receipt of funds from the real estate agent
  • Finance has been approved by the date nominated subject to approval
  • Any other special conditions to the sale contract have been fulfilled. i.e. a sale subject to building inspection.
  • Mortgage documents have been signed and returned to Brooke Yoxon Money Solutions
  • Building &/or building and content insurance for the property has been arranged
  • Removalist &/and removal plans arranged for after settlement
  • Arrangements have been made with the real estate agent to obtain the keys after settlement
  • Bank cheque’s required for settlement (if any) have been issued and provided to your conveyancer
  • Final inspection has been arranged with the real estate agent prior to the settlement date
  • Arrange utilities to be connected in your name, such as the Gas, Electricity, Water, Phone and internet.(Council rates will be transferred to your name as part of the settlement process and this can be confirmed with your conveyancer)
  • Re-direct your mail
  • Notify services currently using your old address. i.e. your gym, school, work etc..
  • Notify any services you currently receive to your old address. i.e. gardeners, lawn-mowing, house cleaning etc..
  • Arrange a house or apartment clean of your previous residence
  • Inform utilities of old residence that you have moved out and require a final account.

This checklist was made for a typical residential property and is intended as a guide only. This is not an inclusive list of all requirements but rather an outline of what to expect.

• • Keys for new property have been received or arranged
  • Building and Content insurance has been arranged
  • Power and utilities have been arranged to the property
  • Upon initial entry a quick room by room inspection to ensure the property matches the pre-settlement inspection expectation.
  • Anything which may waiver from expectation is noted and photographed before moving in Check and test any handover items such as alarm codes, garage door openers, automatic gates, sensors &/or devices. Check that included fixtures and fittings and (if any by special agreement) items are present at property and in functioning order.