Frequently Asked Questions

Principal & Interest (P&I) repayments reduce the loan balance every month and cost less interest over time. Interest‑Only (IO) covers just the interest for a set period (e.g., 1–5 years), keeping repayments lower short‑term but usually costing more interest overall. At the end of an IO period the loan reverts to P&I or needs refixing/refinancing.

LVR (Loan‑to‑Value Ratio) is the loan amount divided by the property’s value, expressed as a percentage. For example, a $600k loan on a $750k property has an LVR of 80%. Lower LVRs can mean sharper rates and no LMI; higher LVRs may need Lenders Mortgage Insurance.

LMI may apply when your LVR is above 80% (varies by lender and policy). It protects the lender, not you, if the loan defaults. You can pay it upfront or sometimes add it to the loan. Strategies like using a guarantor, a bigger deposit, or splitting the purchase can help avoid or reduce LMI.

Equity is your property value minus your loan balance. Usable equity depends on lender policies and acceptable LVR. For example, if a home is worth $800k and your loan is $400k, 80% LVR implies potential borrowing up to $640k, so ~$240k equity may be accessible (subject to assessment, fees, and purpose).

Consider refinancing if your rate is uncompetitive, your fixed term is ending, your goals have changed (e.g., cash‑out for renovations/investment), or you want features like an offset account. We’ll weigh savings against costs such as discharge fees, new application fees, government charges, and any break costs on fixed loans.

Typical costs may include lender application fees, valuation fees, settlement/discharge fees, and government registration. Some lenders offer rebates that can offset costs. We’ll give you a personalised estimate before proceeding.

Both reduce interest by lowering your effective loan balance. An offset is a separate transaction account linked to your loan; money kept there reduces interest daily and stays readily accessible. Redraw lets you pull out extra repayments you’ve made. Tax and access rules differ — especially for investment use — so ask us before moving funds.

Fixed gives repayment certainty for a set term but can have limited features and break costs. Variable moves with market rates and often offers more features (offset, extra repayments). Many borrowers split the loan to blend certainty and flexibility.

Lenders assess income (after shading), expenses (HEM benchmark and your declared spend), debts/limits, buffers on rates, and property type. Policies vary widely — different lenders can yield very different borrowing capacities. We match your profile to the right policy.

Roughly: pre‑approval (1–10 business days), property search, offer & acceptance, formal approval after valuation, then settlement (usually 21–45 days from contract). Timelines vary by state, lender, and documentation.

In Australia, interest deductibility generally depends on the use of funds, not which property secures the loan. If equity is used for income‑producing purposes (e.g., an investment property), interest may be deductible. Seek tax advice for your circumstances.

The bank valuation influences your LVR, available products, and whether LMI applies. We can order upfront valuations with some lenders to de‑risk your application and choose the best pathway.

Bridging finance helps you buy a new property before selling your existing one by covering the gap temporarily. Interest usually capitalises during the bridge period and you pay down to an end debt once the sale settles. Suitability depends on equity, repayments, and risk tolerance.