gtag('config', 'AW-790782773');Positive SSL
On this page you can look through some frequently asked questions to find the answers you might be looking for. This is also a good point to start if you’re looking at getting a home loan for the first time.
Investor Edge is a scheme that allows people to transfer the discounts from an investment home loan to a principal home loan, resulting in lowering the interest rate on their principal home loan. The scheme encourages frequent investing to aid people looking to break into the real estate market in building up a portfolio quickly, while simultaneously lowering the interest rate on their principal home loan.
It’s a new product! The Investor Edge was invented by Guardian National Mortgage, and we are currently the only mortgage advisors offering this product!
The saying “If it sounds too good to be true, it probably is” most definitely DOES NOT apply to Investor Edge. Our product is totally legally binding, it just makes the best use of your loans and their associated discounts, allowing you to pay off your mortgage faster and develop a property portfolio and equity quickly.
A Portfolio is the collective representation of a person’s financial assets, as well as the income they generate, and the debt used to attain them. Equity is any assets owned, minus the liability on said assets.
Using Investor Edge means several things:
The Investor Edge scheme also comes with a 100% Offset Account, lowering the interest rate on your principal home loan even further.
Simple! To qualify for Investor Edge, you need only have an Investment debt that is higher than your Personal debt, and to qualify for any standard loan. If you fit that criteria, you qualify for Investor Edge!
An Alt Doc Loan (short for Alternative Documentation Loan) is a loan typically given to freelancers and business owners that lack the typical loan documentation.
These loans are granted to freelancers and business owners primarily because their financial situation means they don’t have access to typical loan application documents. While it is theoretically possible for people that aren’t freelancers or business owners to take out Alt Doc loans. the inflated interest rates associated with them would cause more harm than good.
To qualify for an Alt Doc loan, the only documentation necessary is a bank statement and BAS statement. These loans normally have much higher interest rates.
A Bank Statement is a regularly issued document which shows all deposits into and withdrawals from a particular bank account. These can be used as a proof of income. A BAS (business activity statement) is a document regularly submitted to the Australian Taxation Office. It keeps track of goods and services tax, Pay as You Go instalment (PAYG), Pay as You Go withholding tax and other taxes.
Yes, an Alt Doc loan can be used for any purpose that a regular home loan may be used for. Just as you can take out a variable rate principal home loan, you can take out an alt doc investment home loan.
An alternative documentation loan doesn’t reflect poorly on a credit score unless you fail to make the necessary repayments on said loan.
“Residential Lending” is what banks and lenders do when they grant a home loan to a borrower for the purpose of purchasing a residential real estate property.
Real Estate is property that comes in four distinct categories. Residential Real Estate include new constructions and resale homes, most commonly single-family homes. Residential real estate can also include condos, co-ops, townhouses, duplexes, triple deckers, quadplexes, high value homes and multi-generational and holiday homes. Commercial real estate includes shopping centres and strip malls, as well as medical or educational buildings. Apartments are also considered commercial because they generate income through rent. Industrial real estate is comprised of manufacturing buildings and property, and can be used for research, production, storage and distribution. Finally, Raw Land involved vacant land plots, working farms, ranches, as well as undeveloped properties. Raw land can also include land that is early development or reuse, as well as sub-divided lots.
This depends on how you go through taking out a loan, as well as the type and cost of the property you are getting the loan for. There is an application fee, an ongoing monthly fee, interest, property valuation, settlement etc. There will also be a fee for any additional help you utilise, such as an accountant, broker, and legal representation. If you intend to borrow 80% or more of the property’s sale value, then you will also incur a Lender’s Mortgage Insurance fee, however this can be waived with the use of a family pledge loan.
There is a plethora of available loan types that can be applied for. Variable Rate loans feature a fluctuating interest rate reflecting economy changes and carry the benefit of additional features such as extra repayment/redraw facilities and an offset account. Fixed Rate loans offer a fixed interest and repayment rate for a period of (typically) 1-5 years, at a much higher interest rate that normal in the current market. Family pledge loans allow borrowers to take out 80% of their desired property’s value while not incurring the additional LMI fee. This is done by offering up a part of a friend’s or family member’s house as the collateral should things fall through. Low Doc loans (also called Alt Doc loans) are loans generally given to freelancers or business owners that don’t have the standard loan application documents necessary, and typically have higher interest rates. Line of Credit loans allow borrowers to draw from their equity to make other purchases. Non-Conforming loans are generally given to those with bad credit, or who haven’t been employed for a long time. A Non-Conforming loan allows borrowers to borrow 80% on their desired property.
A broker is an individual whose job it is to work with a client, assess their financial situation, find the best mortgage for them, and lodge the application for the loan. Brokers also deal with refinancing loans and negotiating terms on behalf of their client for the best possible deal. Brokers often work for a number of banks or lenders and get a commission for their services when they direct a client towards them.
This question really comes down to self-confidence and experience. If you’re a first-time borrower, with little to no experience in the market and don’t have the time (or inclination) to do the appropriate research, then a broker can be your best friend. If you’re an experienced borrower with advanced knowledge of all the financial jargon and institutions involved and how they work, then you may be more comfortable with organising your loan yourself.
This depends on the loan you intend to take out. Most loans require pay stubs, a bank statement as well as an up to date credit record and tax statement. No Doc/Low Doc or Alt Doc loans only require proof of income, such as a bank statement, as well as a BAS statement.
After the relevant research has been done you can apply for a loan with the relevant bank or lender, or you can have your broker apply for one for you.
Refinancing occurs when a borrower decides to revise the terms of a financial agreement with their lender, including interest rate, repayment rate etc. This can usually come as a result of a rise or fall in interest rates and can save a large amount of money on a loan’s interest in the long run.
When a client decides they want to Refinance their loan, they take any necessary financial information to their lender or broker, who then reassesses the client’s financial situation. This assessment determines whether or not the client is eligible for a better deal in the current financial climate. If so the client can choose to opt for that deal, or to change lenders altogether if someone else is offering a more competitive deal.
This depends on who you’re refinancing with, as well as what state you live in, however common costs to enquire about before refinancing include:
However, a recent study carried out in January 2018, found the average refinancing cost settling at $712, while the maximum amount paid was $3,837.
As we just saw, refinancing can be expensive, so trepidation is perfectly natural, however the expense now can serve you well in the future. Refinancing presents you with an opportunity for an impromptu drop in your interest rate, even the type of loan you have out. If you’re finding that in the financial climate your fixed rate home loan with an interest rate of 5.48% for 5 years isn’t working out as well as you thought, refinancing can allow you to change to a variable rate home loan and all its associated benefits and facilities! You could even change to a professional or basic package and get a further discount on your interest! Of course, refinancing should always be done with the help of a qualified broker or financial advisor.
This depends on the situation. If you took out any loan that wasn’t a No Doc, Low Doc or Alt Doc loan, then you will need a bank statement, a tax return and pay stubs. Refinancing is, in effect, taking out another loan via updating your current loan, so banks and lenders need to be sure that their revised investment is going to be handled with care. For No Doc, Low Doc and Alt Doc loans, you need only a Bank and BAS statement, however if you decide that you would like to move to a loan type other than these, you will require the additional paperwork.
In short, whenever it would be beneficial. If after a few years you’ve got a considerable amount of money saved up (anywhere from 3,000-5,000) and the market has made some considerable changes, it would be worth checking out your credit score and looking at possibly refinancing your loan.