Comparison rate
This rate can help you identify the true cost of a loan. It is calculated using a formula that includes the interest rate as well as certain fees and charges relating to a loan.
LVR – Loan to value ratio
Percentage of your property value in comparison to the amount of money being borrowed. For example, if you property is worth $725,000 and you are borrowing $580,000, your LVR is 80%.
LMI – Lenders Mortgage Insurance
Lenders Mortgage Insurance is not home insurance policy and is there to protect your lender if you can’t pay your mortgage repayments. This is an additional cost to complete the transaction.
Deposit
This is the initial contribution you are going to pay towards the purchase. 20% deposit might usually help you avoid the LMI which is an additional cost.
Stamp Duty
Stamp duty is an additional cost which is the tax imposed by state governments on the purchase of real estate assets. Check how much stamp duty is payable using our easy to use stamp duty calculator.
It’s very important for first home buyers to think about all the costs involved in buying their first home before committing to something. Depending upon the property price and deposit, you might be able to avoid LMI and Stamp duty.
Please contact us if you’re unsure about any of the above. As your local mortgage broker, we provide free consultation tailored to first home buyers in Schofields, Akuna Vista, Riverstone and nearby suburbs.
We’ll help you understand your options, navigate the complexities of buying your first home, and secure a loan that works for you.
