FAQs

Sydney finance and home loan FAQs

WHAT DOES A MORTGAGE BROKER DO?

Your mortgage broker takes the hassle out of finding a loan by acting as a middleman between the lender and yourself. We discuss what‟s important to you, go over loan features, interest rates, fees and charges from the lender in terms and language you can fully understand. Every personal situation is different - what works for your friend might not work for you - meaning that we need to have a thorough discussion before any recommendations are made. With literally hundreds of products available, we‟re here to make
your decision simple by presenting you with the best. We represent dozens of lenders in one meeting and are able to explain the benefits of each product.

WHAT LENDERS DO YOU DEAL WITH?

We deal with all major lenders and non-bank lenders. We‟re not restricted as to which lenders we can deal with. If a lender already works with a broker we‟re able to process your application through them.

How do I apply for a loan?

We simplify the loan applications process by meeting with you and discussing your needs. We provide a product comparison / recommendation statement based on the information you've divulged. We then arrange a suitable time to discuss your answers and recommendations. At this meeting, we can also collate all required paperwork and submit your application to the lender. The lender will assess your application and issue a conditional approval. If you've purchased property, a valuation will then be ordered by the lender. Once the lender is satisfied they will issue an unconditional approval then post a loan offer. Once the offer is signed and returned your new loan is ready to settle.

Why should I use Finance in Sydney instead of going straight to the bank?

Understanding loan products on your own is extremely time consuming and confusing. Our Sydney professionals have a thorough knowledge of all loan information, saving you time and effort. If you go directly to one lender you may miss out on better deals or services on the market, such as free Residex Reports on properties you‟re looking to purchase. Valued at $65, we provide these reports for free as an invaluable tool to make the right property purchase decision. We also offer annual reviews to ensure that
your loan is still suitable to your needs.

ARE YOU MEMBERS OF ASSOCIATIONS OR RESOLUTION CENTRES?

We're members of the Credit Investment Ombudsman (CIO) )#413007) and the Mortgage Finance Association of Australia (MFAA). As an external dispute resolution service, the CIO is an independent agency that handles disputes in the mortgage industry. Any client with a complaint unable to be resolved is free to submit a complaint to the CIO. the CIO then addresses your complaint and takes appropriate action when necessary. Please note that to date we have never had any CIO complaints lodged against us or any members of our company. The MFAA ensures that mortgage brokers adhere to high levels of educational and professional standards. It has the right to exclude members in breach of the code of conduct, ensuring that only professional brokers remain practising.

WHAT IS LVR?

LVR stands for the loan to value ratio and is used by lenders to describe what percentage you are borrowing against your property. This is calculated by dividing your loan amount by the value of your property. Lenders use the LVR as part of their own loan assessment to determine whether your loan needs lenders mortgage insurance applied to it. If not, lenders are generally more flexible with their credit policies.

WHAT IS LMI?

Lenders mortgage insurance (LMI) is applicable when borrowing more than 80% of the property‟s market value. This is designed to protect the lender and not the borrower. If you were to default on your loan the LMI company would recover the loss of the lender. LMI is calculated on how much is borrowed against the market value of the property. The higher amount borrowed the more expensive, so we recommend keeping your LVR below 90%. LMI premiums vary depending on which lender used. The maximum loan size is $1,000,000 when utilising LMI however some lenders look at higher loans.

DO I NEED A DEPOSIT?

In most circumstances, you need a deposit between 5% and 10%. Some home buyers may be able to borrow 100% of the purchase price of the property. (this is the case when you have a family member who is prepared to offer their property up as additional security for your loan). This is one way that you can avoid paying lenders mortgage insurance. In such a situation, lenders will request the family members that own the property to seek independent legal advice in order for them to fully understand the
implications of a family guarantee. For clients that don't have a family member – but they do own properties themselves – are able to place their property up for additional security which may allow them to borrow 100% of the purchase price of their next property.
Clients that don't have a family member – but do own properties themselves – are able to place their property up for additional security with a required minimum of 5% deposit plus costs. Some banks will lend up to 95% of the purchase price of the property, while also capitalising part of the lender's mortgage insurance. 

Currently, the majority of lenders are requiring that applicants have 5% of their deposit in genuine savings (genuine savings refers to you being able to demonstrate that you have had the 5% as a deposit for a minimum duration of 3 months). Clients who already own their property – and have equity in their property – have the ability to use the equity in their property as collateral security.

WHAT PROCEDURES DO I NEED TO FOLLOW WHEN BUYING A HOME?

Initially, you need to settle on where you want to live and how large your budget is. You also need to talk with your Finance in Sydney consultant to establish whether or not a lender is prepared to provide you finance for your property purchase. This can be done by submitting an application to the lender for a Pre- Approval. During this process, you should connect with a Conveyancer or solicitor to guide you through the legal process in purchasing a home. It's also imperative that you research the area in which you're looking to purchasing a home. Some of the key requirements that our client's mention are as follows:
  • Transport services
  • Schooling
  • Shopping
  • Work
  • Medical facilities
  • Demographics of the area
  • Potential for capital growth
  • Major development in the local area that could impact on your property
We can provide you with some key information through our free Residex Reports – valued at $65 each, which are provided to you free of charge. The Residex Reports will provide you with the following information:
  • A single price estimate for the property you‟re looking to purchase
  • Sales history for the property (where applicable)
  • Range of values in the street
  • Comparable recent sales
  • Demographic data
  • Medium values and returns
  • Predictions/projected growth for the suburb
  • Housing and rental data for the area
When you have found the property that you are interested in, you can make an offer. We should note that the process of buying a property differs from state to state. Sometimes you may have a cooling off period written into the contract, allowing you to arrange pest and building inspections or strata searches where applicable, as well as finalising your unconditional loan approval. This involves getting a valuation of your property to confirm its purchase price.

Once all of your background research and due diligence has been completed – and your loan has been unconditionally approved – you are now free to commit to purchasing the property and placing a 10% deposit down. Note from time to time you may be able to negotiate a 5% deposit or provide a deposit bond instead of cash.

As a general guide, there are usually 6 weeks (42 days) between when you sign the contract and when you settle on your property. During this 6-week period, we will be talking with both your solicitor and your lender to ensure that everything is progressing the way it should be. Note that you may be able to negotiate a shorter time to settle or an extended settlement if necessary. On the day you settle, your agent will have the keys to your new home and you are free to move into your property. The lender will provide you with a letter advising as to when your first repayment will need to be made – they will also confirm how the repayments will be made. This is often done through a direct debit.

WHAT IS THE DIFFERENCE BETWEEN A CONVEYANCER AND SOLICITOR?

Conveyancers are specialised and only work with specific property matters. They often have a legal background and are often required to hold a licence as well as formal qualifications and applicable insurance policies. Solicitors can give legal advice and prepare legal documentation and can also act as your Conveyancer. So, the difference between a Conveyancer and a Solicitor is that the Solicitor is able to provide legal advice whereas a Conveyancer is unable to do so.

What do I need to do before moving in?

Ensure that you are organised prior to settlement. You need to decide things like whether or not you will be hiring a removalist or if you will be moving. Also, ensure that you start packing early so on the day that you move you are not running out of boxes. This will make the move as stress-free as possible. You must also detail a list of companies that send you paperwork through Australia Post and then notify them of your new address. This can be done by going down to Australia Post and requesting they lodge a mail redirection on your existing address for a period of 3-6 months. This will give you enough time to ensure that all of your mail is now being formally sent to your new address.

Tip: it‟s crucial you inform all companies that send you bills to ensure that they post these to your new address. We have seen some telecommunication companies send out bills to old addresses, leading to clients never receiving the bills, ultimately incurring late payment fees, and, in the worst case scenario, damaging their credit ratings that complicate matters when you are applying for further credit in the future. Lastly, advise friends and family of your new postal address and cancel any services that you may have such as Foxtel, etc.

What is settling a loan?

Settling your loan means the lender has advanced you the funds to complete your property purchase, and you are now the proud owners of a new home that has subsequently been transferred into your name. On the day that you settle your loan, a meeting is held between the vendor‟s Conveyancer or lender and the purchaser‟s Conveyancer or lender. During this meeting, the purchaser‟s lender will provide cheques to the Conveyancer or to the vendor‟s lender (if they have a loan on the property). The vendor‟s
Conveyancer or lender will hand over the title deed to the purchaser‟s lender, which will then be used as security for the purchaser‟s new loan.

WHAT IS REFINANCING?

Refinancing your loan involves moving your loan from one lender to another. When you originally took out your loan, it may have been the most suitable loan for you at that time. However what was once optimal may now be outdated and sometimes damaging. Over time, lenders who were previously unavailable may become available and new products could have been released into the marketplace.

WHY REFINANCE?

Clients refinance for any number of reasons, including:
  • They are looking for a better deal
  • They are looking to reduce their interest rate
  • They are looking to reduce their monthly payment
  • They are wanting to consolidate some debt
  • They are looking to complete renovations on their house
  • They are just generally unhappy with their existing lender

WHAT PRODUCTS CAN I USE WHEN REFINANCING?

There are various products that can be used when refinancing, including:
  • 100% offset account
  • Professional package loan
  • Basic loan
  • Fixed rate loan
  • Line of credit

THINGS TO CONSIDER WHEN REFINANCING

Refinancing your loan may seem to be the right decision at the time, though you need to consider other factors. If you move your loan from one lender to another, think about the true savings you will actually receive. You need to consider:
  • The cost to refinance
  • Interest rate savings
  • Will your new lender be the most competitive lender in 12 months time?
If you are looking to refinance your loan to consolidate debt, it's important to consider how you are going to consolidate that debt. For example, if you were going to consolidate your car loan into your home loan, you may take out a second loan over a 4-year period so that you are not paying for your car over a 30- year term (this will obviously add additional and unnecessary interest costs onto your loan).

You may be 10 years into a 30-year loan and you are looking to refinance your current debt level over an additional 30 years. This would effectively reduce your monthly repayment down, however, it will also add an extra 10 years onto your mortgage, incurring further interest expenses. Refinancing is definitely an option that is worth considering. However, when you are looking to refinance,
it‟s crucial that you re-finance for the right reasons.

WHEN REFINANCING, DO I NEED TO SWITCH ACCOUNTS FROM CURRENT BANKS?

It‟s not necessary to switch or move your cheque and savings accounts with your existing lender. However, some clients do find it to be an extremely simple process to move their savings account over to their new lender. Their reason for doing so is that they can see all of their accounts under one internet banking platform. This is especially useful when you establish an offset account.

WHAT ARE YOUR FEES?

The majority of our clients never pay us a fee. As a general rule, we don‟t charge fees to our clients. Rather, we get paid directly from lenders with a typical upfront payment ranging anywhere from 0.55% to 0.77% of the loan limit, plus a trail commission of up to 0.275% (inclusive of GST).
There are only three times or events when a client pays a fee:
  • If you engage our services as your mortgage broker and apply for either a formal approval or a pre-approval, while then deciding to withdraw the application and go directly to another lender or mortgage broker, we will charge a fee of $495 to cover our processing costs
  • If your loan is less than $150,000, we will charge a brokerage fee of $1,000
  • If you repay your loan by refinancing, selling your property or clearing your debt within 24 months of the loan settling you will be charged. The reason for this is that lenders will charge us a fee for providing them with a loan that isn't profitable. This fee that we are charged is known as a clawback, and a typical clawback amount can be up to 0.77% of the loan amount within the first 12 months, and 0.385% within the first 12 to 24 months. If this fee is charged by the lenders, we will then charge you the same amount. Please note that the majority of clients don't need to worry about this fee payment as they will keep the loan for well over 24 months

WHY DO YOU HAVE THESE FEES?

We pride ourselves on providing a level of expertise while offering a high level of service to our clients. When assessing an application, we go through an extensive process which costs the company time and money in order to find the right option for you as the customer. Unfortunately, processing a loan is not a straightforward process – it takes a lot of effort. We believe that we add additional value to our clients through the form of free Residex reports and other perks and benefits. Unfortunately, there is a small percentage of clients who will use this exceptionally valuable service and then go directly to a lender or another mortgage broker. So, in the event that a client doesn't choose to use our services, or they repay their loan within the 24 month period, in order for our business to stay viable with resources we need to charge minor fees.

COMPLIMENTS AND CONCERNS

At Finance in Sydney, we always work hard to build strong and lasting relationships with our valued customers. By listening to your feedback, not only can we address any immediate concerns you may have, we will also continually improve our products and services. We know there are times when you may wish to compliment us on something we have done well and other times when you may wish to tell us we have not met your expectations.

COMPLIMENTS

Our representatives are always delighted to know that they have succeeded in making your experience a pleasant and successful one. If one of our representatives has provided you with exceptional service in any way, please let us know using the details below so that we can further encourage them via this feedback process.

CONCERNS

If for any reason, you do not feel that you have received the highest standard of care from us, we likewise encourage you to share this with us. We have developed a process that we believe makes it easy for you to tell us of your concerns and for them to be addressed quickly and fairly.
You can contact us by whichever of the following means best suits you:
Finance in Sydney
59 Washington Avenue,
Cromer Heights, NSW 2099
T: (02) 9982 8014
F: (02) 9981 7976

If you choose to contact us by mail or email, please make sure you provide as much detail as possible about your complaint.

COMPLAINT UPDATES

If you have lodged a complaint with us you can contact us at any time to ask for an update on status. Contact us through any of the methods listed above and please be sure to refer to your earlier communication so that we can respond effectively.

RESOLUTION

We will try to deal with your complaint on the spot. if this is not possible we will write to you to acknowledge your complaint within 5 days. We will ensure we treat you fairly and will work to resolve your complaint as soon as possible. In the rare event, we are still investigating your complaint after 45 days we will write to you to explain why and to let you know when we expect to have completed our investigation. When we have completed our investigation we will write to let you know the outcome and the reasons for our decision.

Taking it further

We hope that you will be satisfied with how we deal with your complaint. However, if your concerns remain unresolved or you have not heard from us within 45 days you can have your complaint heard by the Credit Ombudsman Service Ltd (COSL). 
You can contact COSL at:
Credit Investment Ombudsman (CIO)
PO Box A252,
South Sydney NSW 1235
T: 1800 138 422
F: (02) 9273 8440

CIO Membership No: 413007

Protecting Your Privacy

COLLECTION AND USE OF YOUR INFORMATION

Finance in Sydney and its representatives will only seek to collect necessary information from you in order to provide you with the credit assistance you have sought from us. We may also use this information for purposes associated with our services such as follow-up calls to assist you.

DISCLOSURE OF PERSONAL INFORMATION

Finance in Sydney and its representatives will never unnecessarily exchange your personal or business information with any third party for any reason unless compelled by force of law. However, in order to assist you, we may be required to provide your personal information to certain organisations. If your information is not provided, we may be unable to assist you. The types of organisations include:
  • Lenders
  • Mortgage insurers
  • Other mortgage intermediaries
  • Valuers
  • Other organisations that assist us such as printers, data storage companies, mailing houses, lawyers, debt collectors, accountants and other auditors
  • Access and alterations to your personal information
You can gain access to your personal or company information or advice alterations to that information by contacting our office:
Trent Bartels or Marc Adam
T: (02) 9982 8014

Information that is easily accessible will be provided to you free of charge. However, information more difficult to access may have a fee associated with the request. You can also contact us for more detailed information on how we collect, handle and secure your personal information.

MARKETING

From time to time, Finance in Sydney may contact you with information about products from either ourselves or our industry affiliates that we believe may interest you. To opt-out of receiving such information, simply let us know by contacting us directly using the office details above.

SECURITY OF YOUR PERSONAL INFORMATION

Finance in Sydney takes reasonable steps to ensure the security of your personal or company information from unauthorised access, theft or modification.

Feedback on the handling of your personal information

Should you be unsatisfied in the manner in which Finance in Sydney has handled your personal information please contact us (per details listed above). We will take all necessary steps to investigate and address your concerns. If the issue you have raised is not resolved to your satisfaction you should contact the Office of the Australian Information Commissioner at:
GPO Box 5218, Sydney NSW 2001
T: 1300 363 992
You can learn more about the Privacy Act and your rights at www.privacy.gov.au.

Any more questions? Call us on (02) 9982 8014.

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