Beginner's guide to home loans

Undo-ing the jargon used in home loans

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What is LMI?

LMI, also known as Lender’s Mortgage Insurance, protects lenders in the event that aborrower can’t repay their mortgage.
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What is a redraw facility?

A redraw facility gives you access to additional repayments that you’ve made, over and above the minimum monthly repayments.
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What is a variable rate home loan?

It contains an interest rate that changes throughout the term of the loan, depending on a number of different factors.
What is a home loan repayment?
Your home loan repayment is a pre-agreed amount of money you need to pay back on your home loan.
What is a discharge fee?
A discharge fee is required when you pay off your mortgage or switch lenders.
What is LVR?
LVR is the amount of money borrowed in proportion to the value of the property being purchased or refinanced.
Why is LVR important?
Lenders consider your LVR to determine the risk associated with lending you money for your home purchase.
How to lower your LVR
You can lower your LVR by increasing your deposit amount or considering a property with a lower purchase price.
What is equity?
Equity is the difference between the value of your property and the amount you still owe on your home loan.

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Buying a home, looking to make the switch or applying for a home loan? Let’s undo the jargon and make home loans simple

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