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Use our Loan Calculator to find out your borrowing power.
LVR is the percentage of money you borrow for a home loan compared to the value of the property. It is used to assess your risk factor as a borrower; we will calculate your LVR before deciding whether to approve your home loan application. The higher your LVR is, the more of a risk you may be to your lender.
First, you'll need to have saved a deposit. 20% is usually a good indicator, however, depending on your circumstances, you may be able to borrow with less of a deposit.
Stamp duty, transfer fees, mortgage registration fees and legal (conveyancing) fees are some of the key costs you'll encounter. You may also need to consider home, building and contents insurance, Lenders Mortgage Insurance and inspection fees also. Once settlement has gone through, you'll need to think about moving costs, utility connections and potentially furniture and appliances too.
Building insurance is required to be taken out equal to the amount stated in the recommendation on the property valuation.
Lenders Mortgage Insurance, if applicable, covers GMCU against a loss in the unlikely event that we have to exercise our right to sell the property due to ongoing defaults in loan repayments.
You can arrange to make your loan repayments either by payroll deduction, direct debit from your savings or transaction account, internet or telephone banking transfer, or at any of our branches.
GMCU gives you the option of making extra repayments on your loan and then having the flexibility of being able to redraw on these extra repayments. Terms and conditions are available on application.
Lenders’ Mortgage Insurance (LMI) is a one-off insurance premium that is added to your home loan to protect the lender against the loss if you’re unable to meet your repayments and needed to sell your home.
When your home is sold and it’s sold for less than the loan balance, LMI will cover the lender for the difference. If this happens to you, it’s important to know that you’ll still be liable for the remaining balance you were unable to pay. This balance will be owed to the company that provided the LMI.
LMI is non-refundable and non-transferable and is usually required when you are borrowing 80% or more than the purchase price. LMI helps protect the lender and opens up the options for homebuyers who otherwise would be able to financially afford to pay a loan but just may not have the desired deposit of 20%.
LMI is calculated based on your LVR and loan amount. That means, the more you save for a deposit, the less LMI you’ll pay because you’ll borrow less.
For example, if you wanted to buy a house that’s worth $600,000, you would typically be required to have a deposit of $120,000 (20% of the property's value).
Let’s say you’ve only been able to save $90,000. This means you’ll need to borrow 85% of the purchase price from a lender and you’ll usually need to pay LMI.
To find out how much LMI you might pay, it’s worth chatting to a Lending Specialist to give you a rough estimated cost as it will depend on your LVR and some other factors.
