Your Questions Answered
WHAT CLIENTS ASK THE MOST
WHAT IS A GREEN HOME LOAN?
Green home loans are designed to encourage borrowers to buy, build or improve their homes in an environmentally friendly way. They typically offer discounted interest rates for houses that are energy efficient, and lessen their environmental footprint.
HOW DOES A GREEN HOME LOAN HELP PROTECT THE ENVIRONMENT?
By being able to qualify for a Green Home Loan you have committed to building or living in sustainable housing that reduces your impact and carbon emissions on the planet. This is done through clever design and material selections helping you reduce your electricity and water usage as well as your monthly bills. If your home loan is also with a responsible lender then they are also playing a key part by ensuring they only lend to people and companies working towards the same goals.
HOW DO I QUALIFY FOR A GREEN HOME LOAN?
Some lenders will reward you with lower interest rates if your house meets a certain criteria. Such criteria generally includes:
-
Solar panels
-
Double glazing
-
Water storage tanks
-
Insulation
To find out if you qualify contact us today.
DOES SUSTAINABLE HOUSING COST MORE?
In short, yes but over the long term, no. Sustainable housing will need to meet a minimum of a 7-star NatHERS rating and typically include additional extras not normally included in standard houses such as Solar Panels, Water Catchment, Double Glazing and different construction methods/materials. While these items do add additional costs through clever designs and construction methods, prices can become very competitive to conventional housing costs. The biggest benefit is over the long term, not only will your home be more comfortable to live in but it will also cost significantly less to run by reducing electricity and water usage.
WHAT IS LENDER’S MORTGAGE INSURANCE?
Lender's Mortgage Insurance, as the name states, protects the Lender not you as the borrower. Lender's Mortgage Insurance (LMI) is a once off fee that normally applies to loans where the customer is borrowing more than 80% of the purchase price. LMI is scaled depending on the percentage you need to borrow (between 80 - 100%) and the amount of the loan (ie, $650,000). LMI can start from $800 and range up to nearly 4% of the loan amount. You have two options to pay this fee.
-
You can pay it upfront on settlement of the loan.
-
Some lenders allow you to capitalise the cost of your LMI, meaning that they will add this figure to your loan amount. For example, if you are borrowing $650,000, your LMI may work out to be $7000. You would actually increase your loan amount to now borrow $657,000 ($650,000 + $7,000).
HOW MUCH CAN I BORROW?
This is the magic question and will be different for every person. To get a better idea of how much you could afford try our calculator here
WHAT IS A COMPARISON RATE?
A Comparison Rate reflects some of the costs of a loan into a single interest rate. The aim of the Comparison Rate is to help you make a more informed decision on the costs associated with a loan, and help you to compare various loans and services offered by financial institutions and mortgage providers.
WHAT IS A RESPONSIBLE BANK?
A responsible bank is a bank or lender that has set out to make our communities and planet a better place. A responsible bank will not loan money to industries that they consider to do harm such as Fossil Fuels, Live Animal Export, Gambling or the Arms Industry to name a few. Instead they invest money to help create positive impacts for communities and the planet. They do this by investing in schemes such as Renewable Energy, Environmental Housing and Community Based Programs.
HOW MUCH DEPOSIT DO I NEED?
Generally speaking, a deposit of 5% is all that you need to purchase a home. Ideally you should be looking to have 20% of the property value as a deposit, this will save you from incurring additional fees such as Lender's Mortgage Insurance. Some lenders will let you borrow up to 95% of the purchase price and then let you borrow the cost of the Lender's Mortgage Insurance on top of that. Alternatively, if you don't have a deposit, you can borrow up to 100% of the property's purchase price, in two ways:
-
Family Pledge: which means that a family member offers their property as security for you to purchase your property.
-
100% House and Land packages: allow you to borrow up to 100% of the price of the brand new home and land.
WHAT IS LVR?
LVR stands for Loan to valuation Ratio. This is the measure of the amount of the loan compared to the value of the property. For example, if you have borrowed $320,000 and your property is valued at $400,000, the LVR would be 80%.