Call Us Today 0431 912 023

0431 912 023
call us today

Useful information

FHOG – First Home Owner’s Grant

http://www.osr.nsw.gov.au/grants/complete/fhog

Stamp Duty and Other Related Calculators

https://www.apps08.osr.nsw.gov.au/erevenue/calculators/index.php

For Your Credit Report or History

https://www.veda.com.au

For the Australian Business Register

http://abr.business.gov.au

For more free related information on loans, different calculators, etc; you can visit any of the 4 major bank’s website, we have listed one below:

http://www.westpac.com.au

Glossary

AAPR
AAPR stands for Average Annual Percentage Rate also known as the Comparison Rate – takes into account introductory and ongoing interest rates, upfront fees, any ongoing fees and other factors not included in the main/headline rate advertised by the lender.
Annual fee
It refers to the yearly fee that some lenders may charge as a maintenance fee.
Application fee
Also known as establishment fees, some lenders may charge an application fee to cover the administration and paperwork required to set up a new loan.
Assets
These are things you own. These can be cash or something that can be converted into cash such as property, vehicles, equipment and inventory.
Bad debts
Refers to money owed to you that is unlikely to be paid to you in the foreseeable future.
Balance sheet
It is a snapshot of a business as of a particular date. It lists all of a business' assets and liabilities and works out the net assets.
Bankrupt
An individual is bankrupt when they cannot pay their debts and aren't able to reach an agreement with their creditors.
Bankruptcy
A process where an individual is legally declared bankrupt and their assets and financial affairs are administered by an appointed trustee.
Basic rate
Basic rate home loans are 'no frills' loans that generally offer lower interest rates than standard variable rate home loans. The trade-off is that basic rate loans generally have less features and flexibility than standard loans.
Bonus rate
Subject to certain terms and conditions, bonus rates are special interest rates offered on savings accounts that are higher than the lender's standard rates.
Break costs
Break costs (also known as break fees; usually a percentage of the original loan amount) are charged by lenders if you terminate a fixed rate home loan before the end of the fixed term.
Budget
A listing of planned revenue and expenditure for a given period.
Cash flow positive
You have a cash flow positive investment if the incomings are more than your outgoings after tax-deductible items have been claimed. You receive more rent than your mortgage repayments, plus you are still ahead after taking into account items such as interest on the loan, maintenance, insurance, land tax, rates, etc.
CGT (capital gains tax)
The tax you pay when you sell an investment property if you've made a profit
Credit
A lending term used when a customer purchases a good or service with an agreement to pay at a later date (e.g. an account with a supplier, a store credit card or a bank credit card).
Creditor
A person or business that allows you to purchase a good or service with an agreement to pay at a later date. A creditor is also anyone who you owe money to, such as a lender or supplier.
Credit limit
A dollar amount that cannot be exceeded on a credit card or the maximum lending amount offered for a loan.
Credit rating
A ranking applied to a person or business based on their credit history that represents their ability to repay a debt
Credit history
A report detailing an individual's or businesses past credit arrangements. A credit history is often sought by a lender when assessing a loan application.
Combination loan
Combination loans (also known as split loans) are home loans that let you have two different types of loan in one. For example, a portion of the loan, say 20%, on a fixed rate and the remaining 80% portion on a variable rate.
Comparison rate
Refer – AAPR above.
Conveyancing
The process that legally transfers property ownership from one entity to another.
Cooling-off period
A period of time given to the purchaser to legally withdraw from buying a property. The length of time varies in each of the states and territories.
Cross-securitisation/cross-collateralisation
When the financial institution uses your property (whether owner-occupied or investment) as security for other property you purchase. Credit union Credit unions are co-operative financial institutions that are owned by members and operated for the benefit of members.
Debit card
Looks and works like a credit card – with the difference that you are using your own money. Linked to your bank account, the debit card automatically debits the money from your account.
Debt consolidation
Debt consolidation is the process of combining multiple existing debts into one loan.
Default
A failure to pay a loan or other debt obligation.
Deferred establishment fee
A deferred establishment fee refers to the fee that is charged by mortgage lenders if you close your loan within the first few years – usually during the first four or five years of the mortgage.
Deferred repayments
Deferred repayments are a feature of some loans, where the borrower is able to defer making repayments for a set period of time, such as three years.
Depreciation
The process of expensing an asset over a period of time. An asset is depreciated to spread the cost of the asset over its useful life.
Discharge fee
A discharge fee (also known as the exit fee) is a fee charged by a lender to cover the administration costs of closing or 'discharging' a loan.
Early termination charges
Early termination charges (also known as early repayment fees) are imposed by some lenders when you close a loan in the first few years, for example, if you switch to another lender, repay the loan in full or default. Note - Early termination charges are not the same as discharge or exit fees. These are the standard administration fees charged by lenders to cover the cost of processing the closure of your loan.
Establishment fee
Please refer to the Application Fee above.
Entry fee
Please refer to the Application Fee above.
Exit fee
Please refer to the Discharge Fee above.
FHOG – First Home Owner’s Grant
A grant available to Australians who are buying or building their First Home, and have not previously owned a Home, separately or with another person.
Fixed rate
An interest rate set for a specific term or a specific period.
Hire-purchase
A type of finance contract where a good is purchased through an initial deposit and then rented while the good is paid off in instalments plus interest charges. Once the good is fully paid the ownership of the good transfers to the purchaser.
Home equity loan
A home equity loan enables a borrower to access the equity in their home to finance other expenses or for any worth-while purpose, such as, home renovations, a new car, investments or even a holiday.
Honeymoon rate
Honeymoon rates (also known as intro rate) are low introductory interest rates offered by lenders to make their home loan offers look more attractive to borrowers. They typically last for the first six to twelve months of the loan, before reverting to a higher ongoing rate.
Interest only loan
It refers to a loan where the principal is paid at the end of the term; during the term only interest is paid. The term for this loan is typically one to five years.
Introductory rate
Please refer to the Honeymoon Rate above.
Joint tenants
Each owner has equal shares and rights in the property.
Liability
A financial obligation or amount owed.
Line of credit
A flexible loan similar to an overdraft or a credit card, where you have a maximum approved limit; but no set repayment and borrowing periods. Repayments are ‘interest only’ and applicable to the funds you actually use or draw-down (not the limit).
Loan
A finance agreement where a person or a business borrows money from a lender and pays it back in instalments (plus interest) within a specified period of time.
Loan to value ratio (LVR)
The Loan to Value Ratio (LVR) is the ratio of the loan amount to the value of the property (amount the property is worth), expressed as a percentage. For example, if the property value is $200,000 and you borrow $100,000, the LVR is 50%.
Low doc loan
A low-doc loan refers to a flexible solution for self-employed people who have income and assets, but they may not have the usual documentation to provide for their income verification at the time of application.
Median
The median house price is the middle price of all sales recorded in a particular suburb, postcode, city or state. If there were 100 sales in a particular suburb, in ascending order, the median would be number 50 on the list. It's commonly assumed that the median price is the same as the average price, but that's not the case. To calculate the average, you would add up the 100 sales and divide the total by 100 (the number of sales).
Minimum Repayments
It refers the periodic least amount of repayment, the lender requires (as per the terms) from you, for you to keep using the facility or loan.
Mortgage
It refers to the transfer of the title of your house or real estate, to the bank or lender, who in turn lends you money; thus your home stands as security against the money that you have borrowed. The lender has the right to re-possess your property if you fail to repay the loan.
Mortgagee
It refers to the lender of the funds.
Mortgagor
It refers to the borrower of the funds.
Negative Gearing
This is an investment strategy where the cost to maintain the investment (loan repayments, maintenance, etc) is higher than the income (rental, etc) produced by the investment.
O&A (offer and acceptance) form
When you make an offer to purchase a property, you sign one of these forms. When the owner accepts the offer, it becomes a binding contract.
Off the plan
When you buy off the plan, you are buying a property before it is built, having only seen the plans. This is commonly used for apartments or units under construction or about to be built.
Offset account
It refers to a transaction account (all your income, salary, etc comes to this account) linked to your home loan; any funds in the transaction account automatically offsets the principal on your home loan; thus leading to reduced interest on your loan. For example, a borrower with a $250,000 mortgage and $25,000 sitting in a 100 per cent offset account ends up paying interest on $225,000 only (as opposed to $250,000).
Ongoing fees
An ongoing fee is a fee charged by your lender to cover the ongoing maintenance of your loan, credit card or other financial contract.
Owner occupied loan
It refers to a loan against a property which is the primary place of residence of the borrower.
Property cycle
Property values usually follow a cycle of growth, a slowdown, a bust and an upturn. History shows this occurs every seven to ten years.
Personal Property
Covers any property someone can own, except for land, buildings and fixtures. Examples include goods, plant and equipment, cars, boats, planes, livestock and more.
Plant and equipment
A group of fixed assets used in the operation of a business such as furniture, machinery, fit-out, vehicles, computers and tools.
Portability
A home loan feature (whereby - if you move house or buy an investment property), you can transfer the mortgage from your existing property to the new one. This typically happens when you sell your home and move before fully paying the original mortgage.
Portfolio (as in property portfolio)
The number and type of investment properties you own
Principal
This is the term given to the actual amount of money borrowed on a loan.
Principal and interest
The amount borrowed or still to be repaid, plus the interest on the mortgage. The principal is part of the repayment that reduces the balance of the mortgage.
Progressive drawdown
When building or constructing a home - funds can be accessed in small lump sums at various intervals to suit the building or construction process.
Redraw
A home loan feature that allows the borrower to withdraw any pre-paid or extra funds paid into the loan.
Redraw fee
It refers to the fee applicable on ‘redraws’.
Refinancing
Refinancing simply means taking out a new loan to pay off an old one.
Rental yields (and calculations)
The return on an investment as a percentage of the amount invested. Gross rental yield can be calculated by multiplying the weekly rent by 52 (weeks in a year), then dividing by the value of the property and multiplying this figure by 100 to get the percentage.
Reserve price
The minimum amount a seller will accept at an auction.
Retention of title
A type of clause that can be included in contracts where a buyer may physically receive property, but doesn’t take legal ownership from the seller until the full purchase price is paid.
Reverse mortgage
A reverse mortgage refers to a loan designed for senior citizens who want to convert their home equity into cash. Unlike a traditional mortgage, it does not require monthly repayments; instead, the payment becomes due when the owner dies or sells his home. Interest is capitalised during the term of the loan.
Strata title – also known as unit title
This title grants ownership of a section or a 'unit' of a larger building. This 'unit' can be sold or transferred by the owner.
Subdivision
A parcel of land divided into individual lots.
Supply and demand
The number of properties on the market at any given time determines the supply-and-demand equation. If there are lots of properties on the market, it's a buyers' market. If there are few properties on the market or those that come on to the market sell quickly, then it's a sellers' market.
Sub-prime lending
Similar to ‘low doc’ home loans, this type of lending refers to loans that don't meet the normal lending criteria. Being high-risk, the interests charged by lenders tend to be higher, and the loans tend to have restricted features.
Scam
A deliberate and targeted deception designed to obtain money or information unlawfully.
Security
Also known as Collateral, is an asset or property a lender can take possession of, in the event the event a loan cannot be repaid.
SMSF
Stands for self-managed-super-fund. An SMSF is a way of saving for your retirement. Unlike other super funds, an SMSF is self-managed, which means you're responsible for making sure the super fund complies with super and tax laws.
Service fee
This is a fee that a bank imposes on loans, transaction and savings accounts, and any other product a bank offers. The service fee is paid until the loan or account is closed and is generally charged annually or monthly.
Sold under the hammer
This means a property that goes to auction sells at the auction.
Serviceability
Whether you can manage your mortgage payments, based on your income and expenses.
Split loan
Please refer to Combination Lending above.
Stamp duty
A state government tax on the transfer of property calculated on the value of the property.
Superannuation
Money set aside for retirement, which must be paid into a complying superannuation fund.
Switching fee
It refers to the fee charged by the lender at the time of moving from one loan type to another during the term of loan.
Tenants in common
Two or more buyers own a property with unequal shares and rights.
Unsecured loan
A loan where there is no collateral or security in place.
Vendor
The seller.
Valuation
A valuation is a report required by the lender detailing a professional opinion about the market value of the property.
Valuation fee
It refers to the fee paid to get a professional opinion about the market value of the property.
Variable interest rate
Variable interest rate of a loan changes with the market conditions for the duration of the loan
Yield
It refers to the return by an investor on an investment, shown as a percentage of the amount invested.
Navigation
×