Useful Tips

Consider the C’s of borrowing

Consider the C’s of Borrowing

Every lender has their own terms and conditions, and this is intended only as a general guide to understanding this topic. Contact us to discuss your individual circumstances.

These are essential lending considerations that we will explore together, with the end result being a personalised solution for your property, financial and personal goals.

Capital (Equity)
How much deposit you have, and is it genuine savings. Or how much equity you have in your current property. Are you eligible for the First Home Owners Grant.

Capacity (Serviceability)
How much will the lender lend you, given your income and other financial commitments?
Each lender has it’s own method of calculating the maximum amount they will lend you. Your maximum loan serviceability will also change as prevailing interest rates change.

Character (Credit history)
What kind of financial citizen are you, and do you have a good, clear overall credit history or history with a particular lender.
(I have Hints & Tips on Credit Reports)

Cash flow (Affordability)
How much does your personal budget enable you to pay off a loan?
If you haven’t worked out a personal budget, you can do an initial check on how you affordable you would find loan repayments. In addition to your current rent or loan commitments, save an additional amount that would duplicate you paying off your new loan.

Collateral (Security Property)
Not all properties are considered equal security for mortgage purposes, as examples:
Lenders often require a larger deposit for properties located in high density areas.
Company Title and Stratum title properties can sometimes require a higher deposit than Strata titles.
More deposit may also be required for properties under 50 square metres. Ask the real estate agent what the approximate size of the property is.
Even if you have loan pre-approval, and you are buying via a private sale, your home loan unconditional approval will be subject to updated supporting documents and a satisfactory property valuation. For this reason you may want to sign the contract “subject to finance” or not exchange contracts until