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The basics


Home loan terms range from 10 to 30 years, with shorter terms requiring higher monthly payments but less interest paid overall. Factors to consider include affordability, long-term goals, interest rates, and flexibility in making extra repayments. Choose a term that suits your financial situation and goals.

Home loan terms typically range from 10 to 30 years, with 25 and 30-year terms being the most common. The term you choose should depend on your financial situation, long-term goals, and preferences. Here are some factors to consider when selecting a home loan term:

Monthly repayments:

  • Shorter home loan terms generally have higher monthly repayments, but you'll pay less interest over the life of the loan.
  • Longer home loan terms usually have lower monthly repayments, but you'll pay more interest over the life of the loan.


  • Choose a term that allows you to comfortably make the monthly repayments without stretching your budget too thin.
  • Be realistic about your financial situation and future income potential.

Long-term financial goals:

  • If your goal is to pay off your mortgage quickly and save on interest, a shorter home loan term may be more suitable.
  • If you prefer lower monthly repayments to free up cash for other investments or expenses, a longer home loan term might be a better option.

Interest rates:

  • Consider the current interest rate environment when selecting a home loan term. If rates are low, locking in a fixed-rate loan for a longer term might be advantageous.


  • Some home loans allow you to make extra repayments without penalty. If you choose a longer loan term but make additional payments when possible, you can effectively reduce the home loan term and save on interest.

Ultimately, the best home loan term for your financial situation and long-term goals will depend on your unique circumstances. It's essential to consider your current financial situation, future income prospects, and how you want to balance your mortgage repayments with other financial goals.


Different lenders offer a variety of payment options, such as direct debit, BPAY, e-transfer, salary deduction, cheque/money order, and in-person for home loans and other credit products. Benefits such as interest rate discounts, fee waivers, or added convenience can be available for automatic payments.

The home loan payment options and methods can differ significantly between lenders, as each institution has its own set of policies, procedures, and preferences. When it comes to home loans, personal loans, and other credit products, borrowers may encounter a variety of options. Frequency or repayments can vary, such as monthly or fortnightly as well, although monthly is most common. In terms of payment methods, options may include:

1. Direct debit: A popular method where the lender automatically deducts the monthly payment from the borrower's bank account on a specified date.

2. BPAY: A popular electronic bill payment system that allows borrowers to pay their loan repayments using their financial institution's online, mobile, or phone banking service.

3. Electronic transfer: Borrowers can set up recurring or one-time electronic transfers from their bank account to the lender's account.

4. Payroll deduction: Some employers offer the ability to deduct loan repayments directly from an employee's pay slip.

5. Cheque or money order: While less common in the digital age, some borrowers may prefer to mail a cheque or money order to the lender each month.

6. In-person payments: Borrowers can visit a local branch of their lending institution to make a payment in person, either by cash, cheque, or card.

Discounts and benefits for automatic payments can vary between lenders. Some lenders may offer incentives for borrowers who set up automatic payments, such as:

1. Interest rate discounts: Lenders may offer a slight reduction in interest rates for borrowers who set up automatic payments, as it reduces the risk of late or missed payments.

2. Fee waivers or reductions: Lenders might waive or reduce certain fees, such as account maintenance or late payment fees, for borrowers who opt for automatic payments.

3. Convenience and peace of mind: Automatic payments ensure timely payments without the need for manual intervention, reducing the risk of late fees and potential negative impacts on credit scores.

It's essential to compare different lenders and their offerings, as benefits and discounts can vary significantly between institutions. Before committing to a loan or credit product, borrowers should thoroughly review the terms and conditions and inquire about any potential benefits for setting up automatic payments.


Pre-qualification and pre-approval are stages of the home loan process which involve assessing different aspects of a person's financial situation. Pre-qualification is the initial step and only involves a review of income, assets, debts, and credit history, without performing a hard credit check. Pre-approval involves a more thorough evaluation, including verification of income, credit history, and financial documentation, as well as a credit check.

The terms "pre-approved" and "pre-qualified" are often used interchangeably to refer to the initial stages of the home loan application process. However, there are subtle differences between the two, which may vary depending on the lender's specific terminology and processes.

1. Pre-qualification: An informal assessment of your financial situation and creditworthiness. It is typically the first step in the home loan process, where a lender reviews your income, assets, debts, and credit history to provide an estimate of the loan amount you may be eligible for. This process is often done online or over the phone and does not involve a hard credit check. Pre-qualification is not a guarantee of loan approval, as it is based on the preliminary information you provide and is subject to further verification and assessment.

2. Pre-approval: A more formal process, where the lender conducts a more thorough evaluation of your financial situation, including verifying your income, employment, credit history, and other financial documentation. This step usually involves a hard credit check, which can impact your credit score. Once you're pre-approved, the lender provides a conditional commitment for a specific loan amount, subject to property appraisal and other conditions.

While pre-approval offers more certainty than pre-qualification, it is still not a guarantee of final loan approval.


Most lenders require a minimum home loan deposit of 20% of the property's value, but there are special programs which can provide assistance with deposits as low as 5%. Government initiatives such as FHLDS, Family Home Guarantee and HomeBuilder Grant, and state-based programs and concessions may be available depending on availability and eligibility criteria.

The minimum deposit required by each bank can vary depending on the type of home loan, the borrower's financial situation, and the lending institution's policies. The minimum deposit is generally expressed as a percentage of the property's value, known as the Loan-to-Value Ratio (LVR).

For a standard home loan, most lenders require a minimum deposit of 20% of the property's value. However, some lenders may accept deposits as low as 5% with certain conditions, such as the borrower taking out Lenders Mortgage Insurance (LMI), which protects the lender in case the borrower defaults on the loan.

There are special programs and schemes available to help with home loan deposit assistance or to reduce the required deposit amount:

1. First Home Loan Deposit Scheme (FHLDS): This government initiative assists eligible first-time homebuyers in purchasing a home with a deposit as low as 5% without requiring LMI. The government acts as the guarantor for the remaining amount, and the number of places in the scheme is limited.

2. Family Home Guarantee: Another government initiative aimed at supporting single parents with dependents in purchasing a home. It allows eligible single parents to buy a home with a deposit as low as 2%.

3. HomeBuilder Grant: This was a temporary government grant for eligible owner-occupiers (including first-time homebuyers) to build a new home or substantially renovate an existing one.

4. First Home Owner Grant (FHOG): This is a one-time grant provided by state and territory governments to eligible first-time homebuyers who are purchasing or building a new residential property. The amount and eligibility criteria differ between states and territories.

5. State-based programs and concessions: Various states and territories may offer additional assistance programs, such as stamp duty concessions, land tax rebates, or shared equity schemes. These programs are subject to specific eligibility criteria and vary by location.

It's important to research and compare the offerings of different lenders and programs before committing to a loan or credit product.


A home loan may involve various fees such as an application or establishment fee, origination fee, valuation fee, Lender's Mortgage Insurance, legal and conveyancing fees, ongoing fees, discharge fee, break cost and a prepayment penalty.

Various fees and charges may be associated with home loans, depending on the lender and the loan product you choose. Some common fees and charges include:

1. Application or establishment fee: This is a one-time fee charged by the lender to cover the cost of setting up the loan. It can range from a few hundred to a couple of thousand dollars.

2. Origination fee: This fee, also known as a loan establishment fee or loan set-up fee, covers the administrative costs of processing your loan application. It may be a fixed amount or a percentage of the loan amount.

3. Appraisal or valuation fee: This fee covers the cost of obtaining a professional valuation of the property you intend to buy or refinance. This is required by the lender to ensure the property's value is sufficient to secure the loan.

4. Lender's Mortgage Insurance (LMI): If you're borrowing more than 80% of the property's value, you may be required to pay LMI, which protects the lender in case you default on the loan. The cost of LMI can be quite substantial and typically increases with the size of the loan and the loan-to-value ratio (LVR).

5. Legal and conveyancing fees: These fees cover the cost of the legal work required to transfer the property's ownership and register the mortgage.

6. Ongoing fees: Some loans may have ongoing fees, such as monthly or annual account-keeping fees or package fees if your loan is part of a home loan package.

7. Discharge fee: This fee is charged when you pay off your loan in full and covers the administrative costs of removing the mortgage from the property Title.

8. Break cost: If you have a fixed-rate loan and decide to refinance, pay off the loan early, or switch to a variable rate, you may be charged a break cost. This fee is designed to compensate the lender for any loss they might incur due to changes in interest rates.

9. Prepayment penalty: Some loans may have prepayment penalties if you decide to pay off the loan early, especially fixed-rate loans. However, prepayment penalties are less common than in some other countries, and many variable-rate loans do not have any prepayment penalties.

It's essential to carefully review the loan product disclosure statement (PDS) and discuss any fees and charges with your lender before applying for a home loan.


A fixed-rate home loan has an interest rate that does not change for the duration of the loan, while a variable-rate loan has an interest rate that fluctuates with the market.

Home loans are typically offered with either a fixed-rate or variable-rate interest structure. The primary difference between the two lies in how the interest rate is determined and how it may change over time.

Fixed-rate loan: A fixed-rate loan has an interest rate that remains constant for a specified period, typically ranging from 1 to 5 years, although some lenders may offer terms up to 10 years. During the fixed-rate period, your interest rate and monthly repayments remain the same, providing certainty and stability for budgeting purposes. After the fixed-rate term expires, the loan usually reverts to a variable rate, unless you choose to fix the rate again for another term.

Advantages of fixed-rate loans:

  • Predictable monthly repayments, making it easier to budget.
  • Protection against rising interest rates during the fixed-rate period.
  • Potential savings if you lock in a low rate before interest rates increase.

Disadvantages of fixed-rate loans:

  • Limited flexibility; many fixed-rate loans have restrictions on making extra repayments or may charge break costs if you refinance or pay off the loan early.
  • Potential higher comparable rates if market interest rates decrease during the fixed-rate period.
  • Less access to additional features, such as offset accounts or redraw facilities.

Variable-rate loan: A variable-rate loan has an interest rate that fluctuates over time based on market conditions and the lender's decisions. Your monthly repayments may change as the interest rate changes, making it more challenging to predict and budget for future payments. However, variable-rate loans often provide more flexibility and additional features.

Advantages of variable-rate home loans:

  • Greater flexibility, such as the ability to make extra repayments without penalty or access redraw facilities and offset accounts.
  • Potential for lower rates and greater comparative savings if market interest rates decrease.
  • Often more competitive rates compared to fixed-rate loans.

Disadvantages of variable-rate home loans:

  • Less predictability and certainty, as monthly repayments can change with interest rate fluctuations and bank decisions.
  • Increased vulnerability to rising interest rates, potentially leading to higher repayments.

Choosing between a fixed-rate and variable-rate home loan depends on your financial situation, goals, and risk tolerance. If you prefer stability and predictability in your repayments, a fixed-rate loan may be more suitable. On the other hand, if you're comfortable with some uncertainty and want greater flexibility, a variable-rate loan might be a better choice. Some borrowers also opt for a split loan, which combines both fixed and variable-rate portions, allowing them to enjoy the benefits of both loan structures.

You can explore StayorGo's extensive list of Fixed Rate Home Loans and Variable Rate Home Loans to find the ideal home loan for you.


Fixed-rate loans provide budgeting certainty with a set interest rate and monthly repayments for a specified period, while variable-rate loans have fluctuating interest rates and offer greater flexibility but no guarantee of repayment amounts. Both options have benefits and risks, so explore your options with StayorGo to find the best fit.

The loan-to-value (LVR) ratio refers to the amount of money a borrower is borrowing compared to the value of the property they are purchasing. It is a common metric used by lenders to assess the risk of lending money to a borrower. Many lenders will not lend more than 80% of the appraised value of the property, which means that the maximum LVR is usually 80%. However, some lenders may offer loans with higher LVRs, up to 95%, but this often comes with additional requirements such as paying for Lenders Mortgage Insurance (LMI). It's important to note that the LVR required by a bank may vary depending on the type of loan, the borrower's creditworthiness, and the lender's policies.


Lenders calculate borrowing capacity using income and expenses to determine the amount you can borrow for a home loan. Generally, lenders use a formula assuming expenses are 30% of your income and a 30-year term.

The amount you can borrow for a home loan will depend on several factors, such as your income, expenses, credit history, employment status, and the value of the property you intend to purchase. In general, lenders will use the following formula to calculate your borrowing capacity: Borrowing Capacity = (Income - Expenses) x Loan Term (eg. 30 years) x 0.7

This formula assumes that your expenses are around 30% of your income and that you will be repaying the loan over a 30-year term. For example, if your annual income is $80,000 and your expenses are $24,000 per year, your borrowing capacity would be calculated as follows: ($80,000 - $24,000) x 30 x 0.7 = $1,176,000

This calculation is only a guide, and different lenders may use different criteria to determine your borrowing capacity. It's important to speak with a lender or mortgage broker to get a more accurate idea of how much you can borrow for a home loan based on your individual circumstances. It's also worth noting that borrowing the maximum amount you are eligible for may not be in your best interest, as you will need to consider other costs associated with homeownership, such as stamp duty, legal fees, and ongoing maintenance costs.


Taking out a home loan involves a number of risks which should be considered before committing, such as interest rate, economic, property market, regulatory and foreign currency risks.

There are a number of risks with taking out a home loan that you should be aware of:

1. Interest rate risk: Interest rates can rise or fall over the life of your loan, which can impact your repayments. If rates rise significantly, it could result in higher repayments that you may struggle to afford.

2. Economic risk: Economic conditions can change over time, which can impact your ability to repay your loan. For example, if you lose your job or suffer a reduction in income, you may struggle to meet your loan repayments.

3. Property market risk: The value of your property can go up or down over time, which can impact your equity in the property and your ability to refinance or sell your property if needed.

4. Regulatory risk: Changes in government policies or regulations can impact your loan or your ability to refinance in the future.

5. Foreign currency risk (for non-Australian residents): If you are a non-Australian resident and borrow in Australian dollars, changes in the exchange rate between your home currency and the Australian dollar could impact your ability to make loan repayments.

It's important to carefully consider these risks before taking out a home loan and to ensure that you have a plan in place to manage them.


Home loans can have certain tax advantages, such as negative gearing, capital gains discounts, depreciation deductions, and the First Home Super Saver Scheme. However, it's important to seek professional advice before relying on any of these benefits.

There are a few tax advantages associated with home loans, particularly for investment properties and in some cases for owner-occupied properties. Here are some key tax benefits to be aware of, however these are just guides and you should seek professional tax advice before committing to invest or purchase property for taxation reasons:

1. Negative gearing: Negative gearing is a strategy used by property investors when the rental income from their investment property is less than the expenses incurred, including mortgage interest, property management fees, maintenance costs, and other related expenses. The loss generated from the investment property can be offset against the investor's taxable income, which reduces their overall tax liability. This tax advantage is typically more relevant to investment properties rather than owner-occupied homes. It should be noted that the Australian Negative Gearing laws are often being reviewed, so please ensure you understand the most up-to-date tax position by seeking professional advice in this area.

2. Capital gains tax discount: When you sell an investment property, you may be liable to pay capital gains tax (CGT) on the profit you make from the sale. However, if you have held the property for more than 12 months, you may be eligible for a 50% CGT discount, which reduces your taxable capital gain by half. This benefit encourages long-term property investment and is available to both Australian residents and foreign residents, although the discount percentage may vary for foreign residents.

3. Depreciation deductions: As a property investor, you may be able to claim depreciation deductions for the wear and tear of the building structure and the fixtures and fittings within the property. These deductions can be claimed over several years and can help reduce your overall taxable income. To claim depreciation deductions, you'll generally need a tax depreciation schedule prepared by a qualified quantity surveyor.

4. First Home Super Saver Scheme (FHSSS): Although not a direct tax advantage of a home loan, the First Home Super Saver Scheme allows first-time homebuyers to save for their home deposit within their superannuation fund. Eligible voluntary contributions, up to certain limits, can be withdrawn to help purchase a first home. The contributions and associated earnings are taxed at a lower rate than regular income, providing a tax advantage for first-time homebuyers.

I'm buying my first home


Australia offers several programs and incentives for first-time home buyers, including grants, reduced stamp duty, a homebuilder grant, super savers scheme, and family home guarantee. Eligibility criteria and concession rates differ across states and territories.

There are several Home Loan related programs and incentives designed to help first-time home buyers enter the property market in Australia. These programs can vary by state and territory, so it's essential to research the specific options available in your area. Some key programs include:

1. First Home Owner Grant (FHOG): The FHOG is a national scheme funded by states and territories that provides a one-time payment to eligible first-time homebuyers to assist with the purchase of a new or substantially renovated home. The grant amount, eligibility criteria, and property value caps differ across states and territories.

2. First Home Loan Deposit Scheme (FHLDS): The FHLDS is a government initiative that allows eligible first-time homebuyers to purchase a property with a deposit as low as 5% without paying Lenders Mortgage Insurance (LMI). The government acts as a guarantor for the remaining deposit amount, allowing buyers to save on LMI costs. The scheme has a limited number of places, and certain eligibility criteria apply.

3. Stamp Duty Concessions: Many states and territories offer stamp duty concessions or exemptions for first-time homebuyers. These concessions can significantly reduce the upfront costs of purchasing a property. Eligibility criteria and concession rates vary by location and property value.

4. HomeBuilder Grant: This is a time-limited grant program aimed at stimulating the residential construction sector. It provides eligible owner-occupiers, including first-time homebuyers, with a grant to build a new home, substantially renovate an existing home, or buy an off-the-plan property. The grant amount and eligibility criteria vary across states and territories.

5. First Home Super Saver (FHSS) Scheme: The FHSS Scheme allows individuals to save money for their first home within their superannuation fund. This can result in tax advantages and help first-time buyers save more efficiently. Certain withdrawal and eligibility criteria apply.

6. Family Home Guarantee: This program helps eligible single parents with dependents buy a home with a deposit as low as 2%, regardless of whether they are first-time buyers or previous homeowners. The government acts as a guarantor for the remaining deposit amount, allowing buyers to save on LMI costs. The scheme has a limited number of places, and specific eligibility criteria apply.


First-time homebuyers can choose from various home loan options, such as basic, variable, fixed, split and low deposit loans. There are also government-funded schemes available to help first-time buyers financially. The right loan depends on individual goals, preferences and situations.

Some common home loan options for first-time homebuyers include:

Basic home loans: These loans typically offer lower interest rates and fewer features, making them a good starting point for first-time buyers.

Standard variable rate home loans: These loans have interest rates that may fluctuate over time. They often come with features such as allowing extra repayments, redraw facilities, and offset accounts to help minimise interest charged.

Fixed rate home loans: These loans allow you to lock in an interest rate for a specific period, usually between 1 to 5 years. This provides certainty around repayments and protection against rate increases during the fixed period.

Split home loans: A combination of fixed and variable rate loans, offering the benefits of both loan types.

Low deposit home loans: Also known as high Loan-to-Value Ratio (LVR) loans, they allow first-time buyers to borrow a larger percentage of the property's value, sometimes up to 95%. However, these home loans may come with higher interest rates and Lender's Mortgage Insurance (LMI) costs.

In addition to these loan options, the Australian government offers support for first-time homebuyers, such as the First Home Loan Deposit Scheme (FHLDS), First Home Super Saver Scheme (FHSSS), and various state-based grants and concessions. These programs can provide financial assistance and help you get on the property ladder more easily. Remember, the "best" home loan for a first-time homebuyer depends on your individual financial situation, goals, and preferences.

Still feeling unsure? Find the perfect home loan for you

Refinancing home loans


Refinancing your home loan may offer you potentially large savings. Consider interest rates, loan terms, fees and costs, as well as loan features. Calculators can be used to compare scenarios and estimate your potential savings.

The amount you can save by refinancing your home loan depends on several factors, including your current interest rate, the new interest rate, loan terms, and any associated fees or costs. Here are some key considerations to help you estimate potential savings:

1. Interest rate: The most significant potential saving comes from securing a lower interest rate on your new home loan. Even a small reduction in the interest rate can lead to substantial savings over the life of the loan. To estimate your savings, compare your current interest rate with the rates offered by other lenders.

2. Loan term: When refinancing your home loan, you can choose to maintain your original loan term or extend it. While extending the loan term may result in lower monthly payments, it can also lead to higher overall interest payments over the life of the loan. If you maintain your original term and secure a lower interest rate, you can save on both monthly payments and total interest.

3. Fees and costs: Refinancing your home loan may come with various fees and costs, such as application fees, valuation fees, discharge fees, registration fees, and Lenders Mortgage Insurance (LMI) if applicable. Make sure to factor in these costs when calculating potential savings. Some lenders may offer incentives, like waiving certain fees or providing cashback, to encourage refinancing.

4. Loan features: If your new home loan offers additional features, such as an offset account or a redraw facility, it may provide further savings or flexibility in managing your finances. However, loans with more features may also come with higher fees, so be sure to weigh the benefits against the costs.

To estimate your potential savings, you can use online refinancing calculators to input your loan details and compare various scenarios such as changing the above listed variables. StayorGo can help


A high credit score can help you access better interest rates when refinancing your home loan, while a poor score may make it difficult to refinance. To improve your credit score, make sure you pay bills and loan repayments on time, lower debt, regularly review your credit report & avoid multiple credit applications.

Yes, your credit score plays a significant role in your ability to refinance your home loan. A credit score is a numerical representation of your creditworthiness, which lenders use to assess the level of risk associated with lending to you. A higher credit score generally indicates a lower risk, while a lower score signifies a higher risk. Here's how your credit score can affect your refinancing options:

1. Interest rates: A higher credit score can make you eligible for more competitive interest rates when refinancing your home loan. Lenders often reserve their best rates for borrowers with good credit scores, as they pose a lower risk of default. Conversely, if you have a lower credit score, you may be offered a higher interest rate or be required to pay additional fees or charges.

2. Home Loan approval: A lower credit score may make it more difficult for you to refinance your home loan, as lenders may perceive you as a higher risk. Some lenders may decline your application altogether, while others may impose stricter lending criteria or require a higher level of equity in your property.

3. Home Loan options: Your credit score can impact the range of home loan products available to you when refinancing. With a higher credit score, you are more likely to have access to a broader range of loan options with different features and benefits. However, a lower credit score may limit your choices, and you may have to opt for loans with less favourable terms or fewer features.

To improve your chances of refinancing your home loan at favourable terms, it's essential to maintain a good credit score. Some steps you can take to improve or maintain your credit score include:

  • Paying your bills and loan repayments on time.
  • Reducing your credit card debt and keeping your credit borrowings low.
  • Regularly reviewing your credit report and correcting any errors or inaccuracies.
  • Avoiding multiple credit applications within a short period, as this may be perceived negatively by lenders.

Before refinancing your home loan, it's a good idea to check your credit score and take any necessary steps to improve it. This will help you access better refinancing options and potentially save you money in the long run. Keep in mind that each lender has its own credit scoring criteria and risk appetite, so it's essential to shop around and compare different refinancing options to find the best fit for your circumstances.


Refinancing your home loan requires property valuation to assess the level of risk and determine loan-to-value ratio for the banks. The cost of property valuation can range from a few hundred to over a thousand dollars, however sometimes this cost is funded by the bank. It's important to consider all related costs before refinancing.

When you refinance your home loan, a property appraisal or valuation is typically required by the new lender to determine the current market value of your property. This valuation helps the lender assess the level of risk associated with lending to you and determine the appropriate loan-to-value ratio (LVR) for your refinanced loan. Property valuation can also be required when you refinance with your existing provider. Whether or not you need to pay for the property appraisal depends on the lender and the specific refinancing offer. In some cases, the lender may cover the cost of the valuation as part of a promotion or incentive to attract customers. However, in other instances, you may be required to pay for the appraisal yourself.

The cost of a property appraisal varies depending on factors such as the property's location, size, and complexity. Typically, the cost can range from a few hundred to over a thousand dollars. It's essential to discuss the appraisal cost and any other fees associated with refinancing with your lender before proceeding with the home loan refinancing process to avoid any surprises. Keep in mind that while refinancing your home loan can potentially save you money through lower interest rates or better loan terms, it's crucial to consider all associated costs, including appraisal fees, application fees, and any other charges, to ensure that refinancing is the right decision for your financial situation.


Early repayment penalties are fees charged by some lenders for early repayment of a home loan or making significant additional repayments. These are more often associated with fixed-rate loans. Variable-rate loans, on the other hand, don't usually incur such fees, however it is crucial to check the loan agreement before signing. In 2011 the Australian government banned variable-rate loan exit fees.

Early repayment penalties, also known as early exit fees or break costs, are fees charged by some banks when a borrower pays off their home loan ahead of schedule or makes significant additional repayments, depending on what home loan they are on. These penalties are designed to compensate the lender for any potential loss of interest income due to the early repayment of the loan. Repayment penalties are more commonly associated with fixed-rate home loans.

When you have a fixed-rate home loan, the lender commits to a specific interest rate for a set period, and they may incur costs if you pay off the loan early or refinance during this fixed term. As a result, they may charge break costs to recover those costs. Variable-rate home loans on the other hand, generally do not have prepayment penalties, and borrowers can typically make extra repayments or pay off the loan early without incurring additional fees. However, it's essential to read the loan agreement and check with your lender to confirm whether any fees or restrictions apply to additional repayments or early loan payout.

It's worth noting that in 2011, the Australian government banned early exit fees on new variable-rate home loans. This regulation does not apply to fixed-rate loans or loans that were entered into before the ban took effect. When considering a home loan or refinancing, make sure to understand the terms and conditions related to prepayment penalties and any other fees, so you can make an informed decision and choose a home loan product that best suits your needs and financial goals.


Refinancing a home loan can help secure a lower interest rate, access home equity, consolidate other debts and improved loan features. Make sure you review the fees, compare different loans and weigh available benefits before deciding to go ahead.

Refinancing your home loan can offer several benefits, depending on your financial situation and goals. Some of the main benefits of refinancing include:

1. Lower interest rate: One of the primary reasons people refinance is to take advantage of lower interest rates. Securing a lower interest rate can potentially reduce your monthly repayments, save you money on interest payments over the life of the loan, and help you pay off your mortgage faster.

2. Change home loan structure: Refinancing allows you to switch between different home loan types, such as moving from a variable-rate loan to a fixed-rate loan or vice versa. This can provide you with more predictable repayments, protect against rising interest rates, or offer greater flexibility, depending on your needs and preferences.

3. Access equity in the property: Refinancing can enable you to access the equity in your property for various purposes, such as home improvements, investment properties, or debt consolidation. By tapping into your home equity, you can potentially use the funds to achieve your financial goals or improve your financial situation.

4. Consolidate debts: If you have multiple debts, such as personal loans or credit card balances, refinancing your home loan can help you consolidate these debts into your mortgage. This can simplify your financial management by having just one repayment to make and may result in lower overall interest payments.

5. Improve home loan features: Refinancing can provide you with access to additional home loan features, such as offset accounts, redraw facilities, or more flexible repayment options. These features can offer greater flexibility and help you manage your finances more effectively.

6. Better customer service: If you're not satisfied with the service provided by your current lender, refinancing can give you the opportunity to switch to a lender that offers better customer support or a more user-friendly online platform.

It's essential to carefully consider your financial situation, goals, and the potential costs of refinancing before deciding to go ahead. Refinancing can involve fees, such as application fees, valuation fees, and discharge fees, which can offset the potential savings. It's crucial to weigh the benefits against the costs and shop around to compare different home loan products and lenders to ensure refinancing is the right decision for your circumstances.


Home loan refinancing usually takes 4-6 weeks and involves researching lenders and their products, submitting an application, property valuations, loan assessments, document review and signing (if approved), and finally settlement. The time frame can vary depending on the lender and individual circumstances.

The refinancing process for a home loan generally takes around 4 to 6 weeks from the time you submit your application to the settlement of the new loan. However, this timeline can vary depending on various factors, such as the bank, your financial situation, and market conditions. Here's a general breakdown of the refinancing process

1. Research and comparison: Before you begin the process, you should research and compare different lenders and their home loan refinancing products. This may take some time, as it's essential to find the best fit for your financial situation and goals. StayorGo can help

2. Home Loan application: Once you have chosen a lender, you'll need to complete the home loan application and submit the necessary documents, including income verification, tax returns, bank statements, and other financial information.

3. Property valuation: The lender may require a property valuation to assess the current market value of your home. This can take anywhere from a few days to a few weeks, depending on the availability of the valuer.

4. Home Loan assessment and approval: After receiving your application and supporting documents, the lender will assess your creditworthiness, verify your financial information, and evaluate the property valuation. This process can take between 1 to 3 weeks, depending on the lender and their workload.

5. Home Loan offer and settlement: If your loan application is approved, the lender will send you a loan contract with the new terms and conditions. Review the contract carefully, and if you agree to the terms, sign and return it to the lender. The lender will then arrange the settlement of your new loan, which can take another 1 to 2 weeks.

Keep in mind that these timelines are approximate, and your individual circumstances may result in a shorter or longer refinancing process.


When refinancing your home loan, you'll need to provide various documents. This may include proof of income, tax returns, bank statements, current mortgage statement, home insurance details, property tax records, credit report (usually sourced by the lender), a property valuation and other documents depending on your financial situation and loan requirements.

When refinancing your home loan, you'll need to provide various documents to help the lender assess your financial situation and determine your eligibility for the new loan. The specific documents required may vary depending on the lender and your individual circumstances, but in general, you can expect to provide the following:

1. Proof of income: You'll need to provide documents that verify your income, such as recent pay slips or tax returns. If you're self-employed or have irregular income, you may need to provide additional documentation, such as profit and loss statements or bank statements.

2. Tax returns: Lenders typically require your most recent two years of personal and business tax returns (if applicable) to verify your income and financial stability.

3. Bank statements: You'll need to provide recent bank statements (usually two to three months) to show your available assets and financial reserves. This may include transaction, savings, and investment accounts.

4. Current mortgage statement: A copy of your most recent mortgage statement will help the lender confirm the details of your existing home loan, such as the loan balance, interest rate, and payment history.

5. Homeowners insurance: Lenders typically require proof of your current homeowners insurance policy to ensure that the property is adequately insured.

6. Property tax records: You may need to provide a copy of your most recent property tax bill or records to show that your property taxes are up to date.

7. Credit report: The lender will usually request a credit report to review your credit history and credit score. Although you don't need to provide this yourself, it's a good idea to review your credit report before applying for refinancing to ensure there are no errors or issues that could affect your application.

8. Property appraisal / valuation: The lender may require a property valuation to determine the current market value of your property. While you won't need to provide the appraisal yourself, you may need to coordinate with the appraiser and lender to schedule the appraisal.

9. Other documentation: Depending on your financial situation and the specific loan requirements, you may need to provide additional documents, such as a divorce papers, bankruptcy paperwork, or proof of other income sources (e.g., rental income or child support).


Refinancing your home loan can give you the option to switch from a variable to a fixed interest rate, or vice versa. It offers the potential for stability, added features, flexibility and savings, but involves possible costs such as break fees, application fees, and valuation fees. Carefully assess the potential benefits against the costs to decide if it's the right decision for you.

Yes, when refinancing your home loan, you can switch from a variable interest rate to a fixed interest rate, or vice versa. Refinancing provides an opportunity to reassess your current mortgage terms and make changes that better suit your financial goals and needs.

Switching from a variable to a fixed rate: If you're currently on a variable rate home loan and wish to switch to a fixed rate, refinancing can help you lock in a specific interest rate for a predetermined period (typically 1 to 5 years, but sometimes even longer). This can provide you with stability in your mortgage repayments, protect you from potential interest rate increases, and help with budgeting.

Switching from a fixed to a variable rate: If you're on a fixed rate home loan and want to switch to a variable rate, refinancing can provide you with more flexibility in your mortgage. Variable rate home loans often come with additional features like offset accounts, redraw facilities, and the ability to make extra repayments without penalties. Additionally, if interest rates are expected to decrease or you want to take advantage of potential savings, switching to a variable rate may be beneficial.

Keep in mind that switching between fixed and variable rates may involve additional costs, such as break fees (for fixed-rate loans), application fees, and valuation fees. It's essential to carefully evaluate the potential benefits of switching against these costs to determine if refinancing is the right decision for your situation.


Refinancing a home loan in Australia can be beneficial, but those doing so should be aware of any costs and tax implications. Interest paid on investment property loans is often income tax deductible, while costs such as lender fees or stamp duty may be subject to capital gains tax. It's best to talk to a qualified professional before making a decision.

Refinancing a home loan in Australia can be a great way to save money, however it is important to be aware of the tax implications. Generally speaking, any interest paid on home loan refinancing in Australia is income tax deductible as it relates to interest on a loan used to purchase an investment property. However, any fees and costs associated with refinancing, such as lender's fees, may be subject to capital gains tax (CGT) if they are considered a part of the cost of the investment, rather than a deduction. Additionally, stamp duty, which is a fee imposed by many of Australia's states, may also have tax implications when refinancing a home loan.

With regards to capital gains from a refinanced home loan, those that choose to remortgage may need to consider whether CGT will be applied, depending on how much of the loan proceeds are used to purchase a new investment property. Typically, CGT will apply to the part of the loan that is used to increase the cost or purchase new property, and any profit made on sale of the property may be subject to CGT, depending on how the loan funds were used. Further, CGT may also be applied if the refinanced loan is used to purchase land or an asset related to land.

Home loan refinancing can be a great way to potentially reduce payments, or consolidate existing debt, however it is important to be mindful of the potential tax implications. If there are any costs associated with refinancing, such as lender's fees, stamp duty, or CGT, the cost should be weighed against any potential benefit from refinancing. It is also important to be aware that any interest paid on the investment loan is usually tax deductible, whereas any fees associated with the refinancing may be subject to CGT and other taxes. It is also important to speak to a qualified professional before making any decisions, as they may be able to provide additional advice on the best course of action.

Applying for a home loan


When applying for a home loan in Australia, you'll need various documents and information. These may include proof of identity, tax file number, income evidence like payslips and tax returns, asset documentation such as bank statements and superannuation statements, debt information, and additional documents like rent payment history. The specific requirements may vary depending on the bank and your circumstances.

When applying for a home loan, the documents required may vary depending on the bank you are applying with, as well as your individual circumstances. For example, if you are self-employed, you will commonly be asked for more information than PAYG employed applicants. However, here's a general list of documents and information you may need to provide when applying for a home loan in Australia:


  • Proof of identity, such as a driver's license, passport, Medicare card or birth certificate
  • Proof of your Tax File Number (TFN), or a statement from the Australian Taxation Office (ATO) with your TFN on it

Income documentation:

  • Recent payslips (usually the last 2-3 months, but sometimes more) showing your year-to-date income
  • PAYG payment summary or group certificate from your employer for the most recent financial year
  • Tax returns from the past two years, if you are self-employed or have other sources of income (e.g., rental properties, investments)

Asset documentation:

  • Bank statements (usually the past 2-3 months) for all transaction, savings, and investment accounts
  • Superannuation account statements
  • Proof of any other assets, such as shares, managed funds, or real estate -Proof of your deposit, such as a bank statement or a deposit bond

Debt documentation:

  • A list of your current debts, including credit cards, personal loans, car loans, and any other outstanding loans
  • Recent statements for each debt, showing the current balance and minimum monthly payment

Credit report:

  • Lenders will typically request a credit report from one or more of the major credit reporting agencies (such as Equifax, Experian, or Illion) to assess your credit history and credit score

Additional documentation (as applicable):

  • Proof of rent or mortgage payment history (e.g., rental statements, bank statements, or a letter from your landlord or property manager)
  • Centrelink statements, if you receive government benefits
  • Proof of any additional income sources, such as rental income or child support
  • Separation or divorce papers (if applicable)
  • Bankruptcy discharge paperwork (if applicable)
  • Contract of sale for the property you are purchasing


To apply for a home loan, you must submit evidence of the following: identification, income, assets, and debts. You may also need to present additional documents depending on your personal circumstances, including Centrelink statements, rental statements, and other relevant information.

When taking out a home loan, there are typically several steps. While the exact process will vary slightly from one bank to another, the following steps provide a general overview:

1. Home Loan Research: Start by researching different home loan options and comparing interest rates, fees, and features offered by various banks. Consider using comparison websites (like Stay or Go here) and home loan calculators to help you with this process. The more, the better so you can form a clear view.

2. Assess your financial situation: Evaluate your income, stability of employment, expenses, savings, and credit score to determine how much you can afford to borrow. Lenders typically use this information to assess your borrowing capacity (how much you can borrow), as well as your risk or likelihood to default.

3. Pre-approval: Applying for home loan pre-approval (also known as conditional approval) can give you a better idea of how much you can borrow and make the home-buying process smoother. Pre-approval is a conditional commitment from the bank based on your financial situation and credit history. It is likely time bound however, so make sure you understand how long the pre-approval period is for (eg. 6 months)

4. Find a property: Once you have pre-approval, you can start looking for a property within your budget. Remember to factor in additional costs such as stamp duty, legal fees, and inspection costs.

5. Apply for the home loan: Once you've found a property, complete the bank's home loan application and submit the required documents, including proof of income, identification, and details about the property.

6. Property valuation: The lender will arrange a valuation of the property to ensure it's worth the amount you intend to purchase it for. This helps them determine the Loan-to-Value Ratio (LVR), which is the percentage of the property's value that you're borrowing.

7. Home Loan approval: If your application meets the lender's criteria and the property valuation is satisfactory, the lender will approve your home loan. They'll then provide you with a formal Letter of Offer, which outlines the terms and conditions of the loan.

8. Mortgage documentation and settlement: Sign the mortgage documents and return them to the bank. Your solicitor or conveyancer will help you with the settlement process, which includes transferring the property's title and paying any fees or taxes.

9. Home Loan funding: After settlement, the lender will provide the funds for your property purchase. You'll then begin making your regular mortgage repayments, until you either pay down the loan or sell the property in future.


The loan approval process for a home loan can take anywhere from 6 to 10 weeks, depending on factors such as the lender, complexity of the loan, and the legal work involved. It usually starts with pre-approval, followed by loan application and approval, mortgage documentation and settlement, and finally settlement.

The loan approval process and time for a home loan from start to finish can vary depending on many factors, including the lender, your financial situation, and the complexity of the loan. Here is a general timeline for each stage:

1. Pre-approval: Obtaining pre-approval on the home loan can take anywhere from a few hours to a few days, depending on the lender and the complexity of your financial situation.

2. Loan application and approval: Once you've found a property and submitted your home loan application, it typically takes between 1 to 4 weeks for the lender to assess your application, conduct the property valuation, and provide a formal approval. This timeline can be affected by factors such as your documentation, the lender's processing times, and the valuation process.

3. Mortgage documentation and settlement: After receiving the loan approval, you'll need to review and sign the mortgage documents. This process can take anywhere from a few days to a week, depending on how quickly you and your solicitor or conveyancer can complete the necessary paperwork.

4. Settlement: The settlement process usually takes between 4 to 6 weeks after the contract of sale is signed. This time allows for the necessary legal work, such as title searches and property transfer, to be completed. Keep in mind that the settlement date is typically negotiated and agreed upon by both the buyer and the seller.

In summary, from the time you apply for a home loan through to settlement, it can take anywhere from 6 to 10 weeks, depending on various factors.


Australian credit scores range from 0 - 1,200 and indicate ‘creditworthiness’. Major banks prefer a score of 600 or higher, non-bank lenders may accept as low as 500-550 and specialist lenders can be more flexible. Good credit scores can result in a lower interest rates and higher chances of approval, whereas lower scores increase likelihood of decline or higher interest rates. Maintain a good score by paying bills on time, limiting borrowing and reviewing your credit report for issues.

Home loan Credit score requirements in Australia can vary among lenders, and each lender has its own criteria for assessing creditworthiness. Generally, credit scores range from 0 to 1,200 depending on the credit reporting agency. The higher your score, the better your creditworthiness. Here's a general breakdown of credit score categories:

Excellent: 800-1,200 Very Good: 700-799 Good: 625-699 Average: 550-624 Below Average: 0-549

While it's challenging to provide specific credit score requirements for each lender, here are some general guidelines:

1. Major banks: The Big-4 banks generally prefer home loan applicants with a credit score of 600 or higher. However, they might still consider borrowers with lower scores, depending on their overall financial situation and the loan's risk level.

2. Non-bank lenders and credit unions: Some non-bank lenders and credit unions may be more flexible with home loan credit score requirements, considering borrowers with scores as low as 500-550. However, these lenders might charge higher interest rates or require additional documentation to offset the increased risk.

3. Specialist lenders: Borrowers with low credit scores or adverse credit histories (eg. previous defaults) may need to approach "specialist lenders". These lenders cater to applicants with unique financial situations or credit issues, and they typically have more flexible credit score requirements for their home loans. However, they often charge higher interest rates and fees.

Your credit score can significantly impact your home loan interest rate and loan eligibility. A higher credit score demonstrates that you are a lower risk borrower, increasing your chances of getting approved for a loan and securing a lower interest rate. On the other hand, a lower credit score may result in higher interest rates or even loan rejection. It's essential to maintain a good credit score by paying your bills on time, keeping your credit utilisation low (eg. limit your borrowings), and regularly reviewing your credit report for errors or inconsistencies. Additionally, shopping around and comparing lenders can help you find the best home loan options for your credit score and financial situation.


The minimum deposit for a home loan typically depends on the property's value, the bank's criteria and the Loan-to-Value Ratio (LVR). Generally, a minimum deposit of 5%-20% is required. For high LVR loans (80-95% LVR) Lenders Mortgage Insurance may be required. Standard LVR loans (up to 80%) usually require a minimum 20% deposit.

The minimum deposit required for a home loan typically depends on both the value of the property being purchased, the bank's criteria and the Loan-to-Value Ratio (LVR). LVR is the percentage of the property's value that you're borrowing. Generally, lenders require a deposit of at least 5% to 20% of the property's purchase price. Here's a general overview of deposit requirements based on the LVR:

1. High LVR home loans (80% to 95% LVR): Some lenders offer high LVR loans, which may require a deposit as low as 5% to 20% of the property's purchase price. However, borrowing more than 80% LVR usually requires Lenders Mortgage Insurance (LMI), an additional cost that protects the lender in case you default on your loan. LMI premiums can be expensive and are typically higher for loans with smaller deposits.

2. Standard LVR home loans (up to 80% LVR): If you can provide a deposit of at least 20% of the property's purchase price, you can avoid paying LMI. This deposit amount is generally preferred by lenders and can provide you with more competitive interest rates and loan terms.

It's important to note that the deposit isn't the only expense to consider when buying a property. You should also budget for additional costs such as stamp duty, legal fees, property inspection fees, and moving expenses. Keep in mind that first-time homebuyers in Australia may be eligible for government grants and concessions, such as the First Home Owner Grant (FHOG) or the First Home Loan Deposit Scheme (FHLDS), which can help with the deposit requirements or reduce the overall cost of purchasing a property. These programs' eligibility criteria and benefits vary by state and territory, so it's essential to research the options available in your area.

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* Comparison rate is based on a secured loan of $150,000 over a 25 year term. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.
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