NEWS & INFORMATION

WHY SWITCH

Quite simply, the best reason to switch is to get a better deal so you can pay your house off sooner.
You might also be shopping around so you can bundle personal debts, such as credit cards, store cards, car loans and personal loans, into your home loan.
While this is a smart move — it will slash the amount you fork out in interest payments — it won’t help you pay your mortgage off sooner because you’re adding to your overall loan amount.

WHAT IS A NON-BANK LENDER?

The term non-bank lender is a little confusing because it implies any financial institution that isn’t a bank, such as a credit union or a building society, falls into this category. The term broadly covers financial institutions that only deal in loans and do not hold deposits. A building society, for example, where you can have a loan product and a savings account, is technically lumped in with banking lenders. However, most consumers would consider a credit union or a building society to be bank alternatives.

YOUR CREDIT FILE

Yes, that’s right – a credit file. It sounds very FBI and, in some ways, it is. Your credit file includes your personal information, including your full name, date of birth, driver’s licence number, gender, addresses and employer information. It also records any credit applications you have made in the past five years, such as home loans or store financing of household goods, plus any bills you have defaulted on and any financial matters on public record, including any bankruptcies or directorships.

Home lenders will look at your credit file to verify your reliability. Being aware of what’s on your file and how you can keep it clean, will go a long way to helping you secure a home loan.

Should I Refinance?

My lender is charging me a higher home loan rate than I see advertised elsewhere. Can I change lenders?

This is exactly the reason why most people change lenders. There may be a penalty clause in your current home loan, meaning you may need to pay a discharge fee, but it could still be in your financial interests to change. When shopping around it is always important to look for the comparison rate of a product. A comparison rate is essentially the true rate, taking into account the fees and charges you will pay on the loan. So even though you see a lower rate it doesn’t mean the repayments are less.
Helpful checklist of documents

Most lenders require the same documents to approve a loan. Make sure you bring the documents below to your meeting with your broker to help fast-track your loan application.

This is a general checklist so some of the documents may not apply to you.
Personal identification 100 points of ID are required.

A current Passport or Birth Certificate = 70 points. Drivers Licence = 40 points. (Please note if these documents are in your maiden name, you will also need to provide a copy of your Marriage Certificate.)
Other documents that help build up 100 points include: a Medicare card, Credit card, ATM/Debit card, Council Rates Notice, Pensioner Concession card, Health Care card, Tertiary Student ID card.

Income details

The two most recent payslips from your employer. (Ideally these will show the company name, number of payslip and year-to-date income figure).
The most recent Group Certificate from your employer.

If self employed:

The last two year’s personal and business tax returns and ATO assessments.
Other income details

You may also need:

Rental income statements or bank accounts showing rental income for any investment properties
Proof of share dividends or interest earned
Centrelink letter confirming family tax benefits
Centrelink letter confirming permanent government pensions
Private pension group certificate or statement
Proof of any other regular, ongoing income.

Additional documents for refinancing

Documentation on your existing loan including the date the loan commenced, loan period and any financial penalty payable if you exit the loan early.
Statements for the last six months for any existing home loans and personal loans
The most recent Council Rates Notice and building insurance policy on the property or properties being offered as security.

Credit cards

If you have credit card debt, statements for the last six months.
If you don’t owe anything on your credit card, the most recent statement.
Additional documents if you already own a home
Statements for the last six months for any existing home loans or personal loans.
Your most recent credit card statement
Copy of the Contract of Sale for the property you’re buying
Statements for the last six months to show your savings/investment history. (This could include share certificates, savings account statements, term deposit statements, etc.)
If other funds are being used for the purchase, evidence showing where the funds are held.
If other funds are being given to you, which are not already in your bank account, you will need a Statutory Declaration from the person giving you the money.

Additional documents for First Home Buyers

Statement for your First Home Saver Account, if you have one.
Statements for the last six months to show your savings/investment history. This could include share certificates, term deposit statements, etc.
If other funds are being used for the purchase, evidence showing where the funds are held.
If other funds are being given to you, which are not already in your bank account, you will need a Statutory Declaration from the person giving you the money.
Your most recent credit card statement.
Copy of the Contract of Sale for the property being purchased.
Additional documents for investors
If you already have investment property/ies:
Evidence of income such as rental statements.
A copy of the tenancy lease.
A Council Rates Notice.
Copy of the Contract of Sale for the property being purchased.
A letter from a property manager indicating likely rent for the new property.
Additional documents for borrowers seeking a construction loan
A copy of a valid builder’s fixed price tender, including all specifications.
A copy of Council approved plans.