Question 1

What is a mortgage?

Accepted Answer

A mortgage is a loan used to purchase property, repaid over time with interest.

Question 2

How do home loans work?

Accepted Answer

You borrow money from a lender and repay it in regular instalments over a set period.

Question 3

How long are home loans usually for?

Accepted Answer

Most home loans run for 25–30 years, though you can pay them off faster.

Question 4

Do I need a mortgage broker to get a home loan?

Accepted Answer

No, but a broker compares multiple lenders and handles the process for you.

Question 5

Is using a mortgage broker free?

Accepted Answer

Yes — brokers are paid by lenders, not by you.

Question 6

How long does home loan approval take?

Accepted Answer

Typically between 2–6 weeks depending on the lender and complexity.

Question 7

What is pre-approval?

Accepted Answer

Pre-approval is an indication of how much a lender may lend you before you buy.

Question 8

Do I need pre-approval before house hunting?

Accepted Answer

It’s highly recommended so you know your budget and can act quickly.

Question 9

Can I buy at auction without pre-approval?

Accepted Answer

It’s risky — pre-approval provides financial confidence and protection.

Question 10

What happens after my offer is accepted?

Accepted Answer

Your full loan application is submitted and assessed by the lender.

Question 11

How much deposit do I need to buy a home?

Accepted Answer

Some buyers need 20%, but many can buy with as little as 5–10%.

Question 12

What is Lenders Mortgage Insurance (LMI)?

Accepted Answer

LMI protects the lender when your deposit is under 20%.

Question 13

Can I avoid paying LMI?

Accepted Answer

Yes — through higher deposits, government schemes, or family guarantees.

Question 14

What upfront costs should I budget for?

Accepted Answer

Stamp duty, legal fees, inspections, and moving costs are common.

Question 15

Can I use savings, gifts, or equity as a deposit?

Accepted Answer

Yes — depending on lender policies and documentation.

Question 16

How much can I borrow for a home loan?

Accepted Answer

It depends on income, expenses, debts, and lender policies.

Question 17

Does HECS/HELP affect borrowing power?

Accepted Answer

Yes — repayments reduce how much you can borrow.

Question 18

Do credit cards affect borrowing power?

Accepted Answer

Yes — even unused limits are counted as debt.

Question 19

Do buy now pay later services affect borrowing power?

Accepted Answer

Yes — lenders factor these into expenses and liabilities.

Question 20

Can I increase my borrowing power?

Accepted Answer

Often yes — through better structuring and lender choice.

Question 21

Can self-employed people get home loans?

Accepted Answer

Yes — many lenders offer flexible options.

Question 22

How long do I need to be self-employed to get a loan?

Accepted Answer

Usually 1–2 years, depending on the lender.

Question 23

Can casual or contract workers get home loans?

Accepted Answer

Yes — some lenders accept irregular income.

Question 24

Do bonuses and overtime count as income?

Accepted Answer

Often yes, if consistent and provable.

Question 25

What’s the difference between fixed and variable rates?

Accepted Answer

Fixed stays the same for a period; variable can change.

Question 26

Which is better — fixed or variable?

Accepted Answer

It depends on your goals and market conditions.

Question 27

What is an offset account?

Accepted Answer

An account that reduces interest charged on your loan.

Question 28

What is redraw?

Accepted Answer

Allows access to extra repayments made.

Question 29

Can I split my home loan?

Accepted Answer

Yes — many borrowers use part fixed and part variable.

Question 30

What grants are available for first home buyers in NSW?

Accepted Answer

FHOG, stamp duty concessions, and the First Home Guarantee Scheme.

Question 31

Can I buy an existing home and still get grants?

Accepted Answer

Some grants apply only to new homes, but concessions may still apply.

Question 32

Do first home buyer schemes have income limits?

Accepted Answer

Some do, others depend on property price.

Question 33

Can I combine multiple grants and schemes?

Accepted Answer

In many cases yes.

Question 34

Do grants change over time?

Accepted Answer

Yes — eligibility and amounts can change.

Question 35

When should I refinance my home loan?

Accepted Answer

Usually every 18–24 months or when circumstances change.

Question 36

Does refinancing cost money?

Accepted Answer

There may be fees, but savings often outweigh costs.

Question 37

Can I refinance with bad credit?

Accepted Answer

In many cases yes, depending on your situation.

Question 38

How long does refinancing take?

Accepted Answer

Typically 2–6 weeks.

Question 39

Can refinancing reduce my repayments?

Accepted Answer

Often yes, depending on rates and structure.

Question 40

Can I make extra repayments on my loan?

Accepted Answer

Yes — most loans allow this.

Question 41

Are there penalties for paying off my loan early?

Accepted Answer

Sometimes, especially with fixed loans.

Question 42

Can I access equity in my home?

Accepted Answer

Yes — many homeowners use equity for renovations or investments.

Question 43

Do interest rates change often?

Accepted Answer

Yes — variable rates can change with market conditions.

Question 44

Will applying for a loan affect my credit score?

Accepted Answer

A credit check occurs, but impact is usually minimal when done properly.

Home Loan FAQs – Sydney & NSW

Getting Started with Home Loans