What Fees To Expect For A Fixed Rate Home Loan

Feb 26
2010
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  • Typical application fee: $600 to $800 (May be less if you already have a loan).
  • Be prepared to pay a higher application fee if you are buying a unit or property off the plan.
  • If you plan to repay or refinance your loan within 4 years from the date of first loan drawing, you may also be slugged a “Deferred Establishment Fee”. This fee can vary from $700 to $2000 depending on the lending institution.
  • Loan service fees: Usually $8 to $10 per month.
  • Settlement attendance fee, usually $150 to $350.
  • If you are changing lenders, you will also usually have to pay a security discharge fee of between: $350 and $1000 for the privilege.
  • Be prepared to pay big if you want out of a fixed rate loan early. Lenders usually will not give any leeway to contract breakers. Picking the direction of home loan rates can be tricky. Just look at the historical rates for the last 50 years.

This is just a snapshot of the fees you can expect when taking out a new fixed rate home loan or changing from a standard variable home loan to a fixed rate home loan. Be sure to get a comprehensive list of fees from your lender or mortgage broker before you sign on the dotted line.



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Written by Jeremy in: Australian Home Loans, Historical Rates, fixed rate home loans, reputable mortgage broker, understanding mortgage loan documents | Tags: , , , ,

Letter From My Mortgage Broker

Nov 11
2009
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I received the following email from my mortgage broker today. Because of my diverse income streams I used lo doc for one of my loans. He is touting for business I am sure, but the letter also drives home the fact that we have a very different lending environment going forward into 2010.

Here’s the letter:

“I am sending you this email to advise you of some SIGNIFICANT changes that have occurred in the Low Doc market over the last few months.

Fortunately, NONE of these changes will affect your current Home Loan, but they may impact on any possible future borrowings that you may be considering.

So, if any of the following scenarios may apply to you, then please call me to discuss your financing options before you take any action:

1/ If you want to sell your current property and purchase elsewhere. It is particularly important that you do not sell your current property without being aware of what your financing options are with respect to purchasing a replacement property. You may find that you no longer have any options under a Low Doc scenario.

2/ If you want to increase your existing Loan.

3/ If you want to refinance your existing Loan.

4/ If you want to buy another Investment property”

I personally think we are returning to the nasty old days like in the 70′s, this means less people able to get loans and a stagnant property sector. I hope I am wrong. Take a look at interest rates in the 70′s, they are high, but not that bad. People just could not get a loan and banks were stupidly tough with lending. However the bankers of that day did not enjoy the extreme bonuses of their counterparts today, so I am guessing the rouges of Martin Place and Collins Street will find a way to gain from others misery.

Now, may just be the time to fix some of your loans for a year or two.

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Written by Jeremy in: Australian Home Loans, Australian Interest Rates, Australian Property Values, Historical Rates, Mortgage Broker, fixed rate home loans | Tags: , , , ,