Glossary of terms

Bridging Finance

Loan which "bridges" the gap between the sale of one property and the purchase of another

Construction Loan

A loan for the purpose of building a property whereby the loan is drawn down over stages of construction.

Conveyancing

Legal fees on a property purchase are called conveyancing fees.

Deposit

The amount of cash you require to contribute towards your home loan application.

Drawdown

When building a home rather than buying, funds can be accessed in small lump sums at various intervals to suit the building process.

Equity

The amount of value you have in a property that is unencumbered, therefore the balance of the homes value once any loans are deducted which use the home as security.

First Home Buyer

A person purchasing a property who has not ever purchased another property in their name.

First Home Owners Grant

A government incentive grant for purchasers of their first residential property to assist with the costs of purchase.

Fixed Rate Loans

Interest rates that are locked in (fixed) for a defined period of time.

Home Loan

Otherwise known as a mortgage, is a loan that is securitised against a property.

Interest Capitalisation

Where the interest is not paid on a regular basis but is instead added to the total loan amount.

Introductory or Honeymoon Rate Loan

So named because they give you a low rate for the first year (honeymoon period) before they revert to the market variable rate.

Line of Credit

This is essentially an equity redraw facility where extra money paid in can be withdrawn again on the same loan.

Loan to Value Ratio (LVR)

The percentage of the total loan the lender will lend you based on the total value of the property. Eg 80% LVR

Mortgage

A loan which is securitised against a property.

Mortgage Broker

A specialist loan broker who acts as a middleman between the borrower and the lender to facilitate the negotiation and application for a home loan or financial product.

Mortgage Offset

This is a way of paying off your mortgage faster by linking your everyday transaction account to the loan and using the balance to reduce interest.

Mortgage Insurance

Mortgage insurance safeguards the lender in case of borrower default and is generally required when the borrower does not have sufficient deposit.

Ongoing Fees

Ongoing fees are those charged periodically over the life of the loan.

Redraw

When you have paid extra money into your loan and withdraw it back if you need it in the future.

Refinancing

Refinancing simply means taking out a new loan to pay out an old one.

Split Loans

Dividing your loan into one-portion fixed and one-portion variable interest rates giving you the best of both worlds.

Stamp Duty

Stamp Duty is a State Government duty on financial and other transactions.

Time Finance

Is the trading name for Time Finance and Home Loans Pty Ltd, a helpful and experienced Home Loan brokerage service provider with a network of mortgage brokers throughout Australia.

timefinance.com.au

The website for Time Finance and Home Loans

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FAQs
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Depends on the size of your deposit, the value of the property, and your servicing capacity (based on your income and how much you are able to repay).

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Most mortgage lenders will require a deposit of 20% or more of the property price. Less may be required however will require mortgage guarantee insurance in most cases

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Depends on the type of loan, intrerestr rate, payment term, and whether you pay monthly or fortnighly. Use us mortgage calculators to guide you.

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Every state is different and may depend on the value, whether you are building or buying an established home. Read more in our FHOG article

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It is a rate that includes both the interest rate and the fees and charges relating to a loan, combined into a single percentage figure that lets you compare loans from differengt lenders on a fair comparison.

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This 'in principle approval' is usually valid for 3 months. Gives you the confidence on how much you can borrow before your purchase a property.

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The cost of Stamp Duty varies between States and Territories. Subject to your personal loan circumstances, the cost of stamp duty can be included in the loan amount you borrow.

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