Home Loan Myths Unmasked

Common Myths of Home Loans in Australia Unmasked

Most first home loan borrowers continue to make mistakes when buying homes or properties. That usually happens because people lack the knowledge of home loan lenders and other underlying factors concerning Home Loans by Loans.com.au in Australia, which cost borrowers money. The article seeks to unmask some myths to enlighten borrowers looking for home loans in Australia.

Bad credit history doesn’t matter
Most borrowers believe that as long as they paid off the bad debt, their credit history is null and void. The truth is that a patchy history haunts borrowers regardless of whether or not they paid the debt. Even if the bad debt is old, a small amount or just a one-off, it will haunt a borrower looking for home loans in Australia. Credit reporting agencies keep records of the debts including mobile phone plans, defaulted credit card payments, and missed payments. Lenders of home loans consult the agencies to get credit history of loan applicants before they complete their loan application.

Assets are the same as income
Borrowers tend towards believing that strong assets can substitute income when servicing home loans in Australia. However, the borrower’s capacity to repay home loans through regular salaries is what makes the difference. The amount of income a borrower has is what determines the amount of money they can borrow.

Personal debts can be rolled into home loans
Most home buyers have a myth that debts such as credit cards and car loans can be consolidated into their home loans in Australia. You don’t want to put all your eggs in one basket, especially with your first home. It is advisable to first build up enough equity before rolling your debts into the mortgage.

It is the credit card balance, not the limits
Borrowers have the myth that the limits of their credit cards count rather than their credit card balance. Well, when applying for home loans in Australia, every type of credit a borrower has in their name is used by lenders to calculate their ability to service home loans regardless of the credit cards’ balance. Borrowers who have less credit and other loans stand better chances than those with a higher credit for their applications for home loans in Australia.

Making repayments minimum and monthly is a good strategy
Home loan’s interest is calculated daily, and borrowers pay the home loans monthly. You can check it out yourself if you use a Home Loan Calculator at Loans.com.au . Borrowers who pay their home loans in Australia pay less interest over the loan’s life as compared to borrowers who don’t pay interest regularly. Consequently, such borrowers reduce the life of their home loans in Australia and they also save their interest rates.

Expectation From Refinance Home Loan

What to Expect When Applying for a Refinance Home Loan

Many Australians think about applying for a refinance home loan at various times during their home ownership experience. Some have heard about incredible benefits from friends and neighbors, such as using equity for investments or home remodeling. While these and other benefits are possible when you apply for a refinance home loan https://www.loans.com.au/ you should know what to expect from this experience before you get started.
A Full Loan Process
Some homeowners think that a refinance home loan is simply an adjustment to their existing loan terms. For example, you may assume that refinancing means that you contact your current lender to request a lower interest rate or to ask for equity out of the home. This is not actually how refinancing works. When you refinance an existing home loan, you must apply for a new loan on your home. The funds from this new loan will pay off your current mortgage. This means that all of your existing loan terms will cease. It also means that you may need to pay for a new appraisal, provide a full range of loan documents and pay for closing costs.
An Adjustment to Your Financial Situation
While the thought of having to walk through the loan process once again may not be ideal, you may enjoy incredible benefits as a result. Because your loan terms may change dramatically, it is possible to lower your interest rate and monthly loan payment. At the same time, you could shorten your term, length, pull out equity or enjoy other benefits. Equity may be used to pay off other debts or for other beneficial purposes. Keep in mind that loan terms and benefits vary. While some home loan applicants may enjoy substantial benefits through a refinance home loan, others may not receive any benefits. It is important to carefully assess the refinance home loan options and the benefits of each one before you decide how to proceed.


Some homeowners have been able to use a refinance home loan to dramatically improve their financial situation, but remember that this is not always the case for all homeowners. In some cases, homeowners may need to wait for more equity to build up in their home or for interest rates to change before it makes financial sense to refinance. Speaking with a lending representative about the Refinance Home Loans by Loans.com.au options available today could make it easier for you to decide if this is the right move for you to make at this time.

Using Home Loan Calculator Before Buying

Use a Home Loan Calculator to Buy a House You Can Afford

Before you take the plunge and buy a house, you need to do your research. You are about to make a big investment. You want to make sure that you can keep it. Purchasing a new home is about more than making sure you have a good credit report. You need to be savvy and know that you have the income to make your monthly payments. A Loans.com.au Home Loan Calculator is a practical tool that can help you as you consider your options for a new home.

Use a Home Loan Calculator Before You Start Your Search
You may have a clear picture in your mind when it comes to what you want in a house. There may be some top picks in your area. Before you even start looking and taking tours of properties, plug in your financial information in a home loan calculator. There are many home loan calculators available online and they are free to use. You plug in some basic information, like your monthly wages, any investments you may have, and any other sources of income for the month. You may also need to fill in your monthly expenses. In the section related to a new home on a home loan calculator, you will include your down payment, the loan term, the interest rate, and real estate taxes. Once you have entered all of the pertinent information on the home loan calculator, you will be given information to help you determine if you can afford a home at a certain price.

Use Your Results to Make a Wise Decision
Once you have the results from a home loan calculator, you will know if you need to adjust your expectations. You may need to shop around for a home that is less expensive. Otherwise, you may find that you are looking at the right price range. If there is room for more of an investment according to the home loan calculator, you can consider homes in a higher price bracket. In the end, a home loan calculator is a resource that will help you to be an informed buyer. You will need to make the final decision about what you can manage on your finances. As you begin your quest for the right home, consider your home loan calculator results. Use the information as you visit homes that are a good fit and see whether you will pre-qualify https://www.loans.com.au/pre-qualify If you are going to try to bargain with a seller, you will know what price you are aiming for from the start.