Lifesaver Home Loans

1. What do Lifesaver Home Loans do?

We use state of the art technology and experience to weave the Home Loan lender minefield. We ask you a series of questions; lenders are eliminated one by one, until you are matched to the right lender or a shortlist of comparable potential lenders depending on your individual needs.

2. Why don’t I go straight to the banks myself?

There are now well over fifty home loan lenders in Australia. Each lender has different lending policies and guidelines to follow. A bank can only offer you the best of what they have available. Unless you are extremely lucky it is very likely that we will find you a better overall deal than you could find for yourself. Remember interest rates are important but are only part of a home loan package.

3. Would it really make much of a difference?

Yes. Imagine you found a property that you just had to have. You are very confidant that you can afford the repayments. What if the lender you chose said that under their lending policy you will need to save more or buy a cheaper house, either way you lose dream property? Lifesaver Home Loans would already have known the lender’s lending policy and would have offered you alternative lenders to choose from, maybe even at a lower rates of interest! To enable you to get the loan that you really want.

4. What loan types does Lifesaver Home Loans work with?

Lifesaver Home Loans are proud to say that whatever your finance needs are we can assist. We specialise in difficult applications, dealing with lenders that many other brokers do not, allowing you more options.

GETTING STARTED

5. HOW DO I KNOW IF I'M READY TO BUY A HOME?

You can find out by asking yourself some questions:
Do I have a steady source of income (usually a job)?
Have I been employed on a regular basis?
Is my current income reliable?
Do I have a good record of paying my bills?

If purchasing. Do I have money saved to cover the costs?
Do I have the ability to pay a mortgage every month, plus normal living expenses?
If you can answer, "yes" to these questions, you are probably ready to buy your own home.If you answered no, still give us a call, We will give you a clear path to achieve your goals.

6. HOW DO I BEGIN THE PROCESS OF BUYING A HOME?

Start by thinking about your situation. How much can you afford for a monthly mortgage payment and how much if any deposit you have? We can then give you an idea of what house price you are able to purchase. The next step is to work out what area or suburbs you would like to live in or near. Do you want a flat/unit/house? Garden? Near schools, public transport and shopping centers? Once you know what your limit is, you can then look for what that buys you in the areas that you like. Talk to friends and family, drive through neighborhoods, and look in the "Homes for sale" section of the newspapers and Internet.

7.What about Real Estate Agents?

No one knows properties in a suburb better than the local real estate agent. They will love to hear from you and will do all they can to help you buy a property in their area. The agent is a great knowledge bank to access and on the whole is extremely likeable and friendly. But be warned! The agent can only show you properties that they have listed for sale (other properties will be listed with other agents) and remember at all times that the agent is acting for the vendor (house owner), trying to get them the highest amount.

8. HOW DOES THE LENDER DECIDE THE MAXIMUM LOAN AMOUNT THAT CAN AFFORD?

The lender considers your debt-to-income ratio, which is a comparison of your gross (pre-tax) income to housing and non-housing expenses. Non-housing expenses include such long-term debts as personal loan and credit card payments, maintenance, or child support. The lender also allows a certain amount for living expenses based on the family unit.

FINDING YOUR HOME

9. WHAT SHOULD I LOOK FOR WHEN WALKING THROUGH A HOME?

In addition to comparing the home to your minimum requirement and wish lists, consider the following:
Is there enough room for both the present and the future?
Are there enough bedrooms and bathrooms?
Is the house structurally sound?
Do the mechanical systems and appliances work?
Is the yard big enough?
Do you like the floor plan?
Will your furniture fit in the space? Is there enough storage space? (Bring a tape measure to better answer these questions.)
Does anything need to repaired or replaced? Will the seller repair or replace the items?
Imagine the house in good weather and bad, and in each season. Will you be happy with it year-round?
Take your time and think carefully about each house you see. Ask your real estate agent to point out the pros and cons of each home from a professional standpoint.

YOU'VE FOUND IT

10. WHAT DOES A HOME INSPECTOR DO, AND HOW DOES AN INSPECTION FIGURE IN THE PURCHASE OF A HOME?

An inspector checks the safety of your potential new home. Home Inspectors focus especially on the structure, construction, and mechanical systems of the house and will make you aware of only repairs, which are needed.
The Inspector does not evaluate whether or not you're getting good value for your money. Generally, an inspector checks (and gives prices for repairs on): the electrical system, plumbing and waste disposal, the water heater, insulation and Ventilation, the HVAC system, water source and quality, the potential presence of pests, the foundation, doors, windows, ceilings, walls, floors, and roof. Be sure to hire a home inspector that is qualified and experienced.
It's a good idea to have an inspection before you sign a written offer since, once the deal is closed, you've bought the house as is." Or, you may want to include an inspection clause in the offer when negotiating for a home. An inspection t clause gives you an 'out" on buying the house if serious problems are found, or gives you the ability to re-negotiate the purchase price if repairs are needed. or withdraw your offer entirely. An inspection clause can also specify that the seller must fix the problem(s) before you purchase the house.

11. DO I NEED A LAWYER TO BUY A HOME?

Laws vary by state. Some states require a lawyer to assist in several aspects of the home buying process while other states do not, as long as a qualified real estate professional is involved. Even if your state doesn't require one, you may want to hire a lawyer to help with the complex paperwork and legal contracts. A lawyer can review contracts, make you aware of special considerations, and assist you with the closing process. Your real estate agent may be able to recommend a lawyer. If not, shop around. Find out what services are provided for what fee, and whether the attorney is experienced at representing home buyers

12. DO I REALLY NEED HOUSE INSURANCE?

Yes. A paid and current homeowner's insurance policy is required prior to settlement. Plus, involving the insurance agent early in the home buying process can save you money. Insurance agents are a great resource for information on home safety and they can give tips on how to keep insurance premiums low.

13. HOW DO I MAKE AN OFFER?

Your real estate agent will assist you in making an offer, which will include the following information:
Complete legal description of the property
Amount of initial deposit money
Total deposit and financing details
Proposed settlement date
Price you are offering
Length of time the offer is valid
Details of the deal, what you expect to be included in the sale.
Remember that this is still only an offer until it is signed as accepted by the vendor.

14. HOW DO I DETERMINE THE INITIAL OFFER?

Unless you have a buyer's agent, remember that the agent works for the seller. Make a point of asking him or her to keep your discussions and information confidential. Listen to your real estate agent's advice, but follow your own instincts on deciding a fair price. Calculating your offer should involve several factors: what homes sell for in the area, the home's condition, how long it's been on the market, financing terms, and the seller's situation. By the time you're ready to make an offer, you should have a good idea of what the home is worth and what you can afford. And, be prepared for give-and-take negotiation, which is very common when buying a home. The buyer and seller may often go back and forth until they can agree on a price.

15. WHAT IS DEPOSIT MONEY? HOW MUCH SHOULD I SET ASIDE?

Deposit money is money put down to demonstrate your seriousness about buying a home. It must be substantial enough to demonstrate good faith and is usually between 5% to 10% of the purchase price (though the amount can vary if both parties agree). If your offer is accepted, the deposit money becomes part of your total payment or closing costs. If the initial offer is rejected, your money is returned to you. If your offer is accepted and then you back out of a deal, you may forfeit all or part of the deposit.

GENERAL FINANCING QUESTIONS: THE BASICS

16. WHAT IS A MORTGAGE?

Generally speaking, a mortgage is a loan obtained secured against real estate. The "mortgage" itself is a lien (a legal claim) on the home or property that secures the promise to pay the debt. It is possible to have more than one mortgage against a property.

17. WHAT IS A LOAN TO VALUE (LTV) HOW DOES IT DETERMINE THE SIZE OF MY LOAN?

The loan to value ratio is the amount of money you borrow compared with the price or appraised value of the property. Each loan has a specific LTV limit. For example: With a 95% LTV loan on a home priced at $200,000, you could borrow up to $190,000 (95% of $200,000), and would have to pay up to $20,00 as a down payment.
The LTV ratio reflects the amount of equity borrowers have in their homes. The higher the LTV the less cash home buyers are required to pay out of their own funds. So, to protect lenders against potential loss in case of default, higher LTV loans (usually 80% or more) require a lender’s mortgage insurance policy.

18. HOW LARGE OF A DEPOSIT DO I NEED?

There are now ‘no deposit’ mortgage loans available that lend the total purchase price and most or all of the costs. But the larger the down payment, the less you have to borrow, and the more equity you'll have. Mortgages with less than a 20% down payment generally require a mortgage insurance policy to secure the loan. When considering the size of your down payment, consider that you'll also need money for closing costs, moving expenses, and - possibly -repairs and decorating.

19. WHAT STEPS NEED TO BE TAKEN TO SECURE A LOAN?

The first step in securing a loan is to complete a loan application, and provide supporting information.
The information required varies depending on the lender and the type of loan being applied for.

For example a payg applicant would usually need the following information:
Pay slips for the past 2-3 months or a letter from your employer.
Group certificates or tax returns for the past 2 years
6 to 12 months statements of your existing home loan(s).
6 months statements of any other loans.
Proof of any other income.
Sales contract if purchasing. Rates notice if refinancing.
During the application process, the lender will order a report on your credit history and a professional valuation of the property you want to purchase. The application approval process typically takes between 1-6 weeks.

20. HOW DO I CHOOSE THE RIGHT LENDER FOR ME?

That is where we come in! With so many choices it is no wonder that people get confused. Remember that obtaining the lowest interest rate may not mean that you have the best loan for you. We listen to what your current and future needs are and can then suggest several lenders from which to choose.

21. HOW ARE PRE-QUALIFYING AND PRE-APPROVAL DIFFERENT?

Pre-qualification is an informal way to see how much you maybe able to borrow. You can be 'pre-qualified' over the phone with no paperwork by telling a lender your income, your long-term debts, and how large a down payment you can afford. Without any obligation, this helps you arrive at a ballpark figure of the amount you may have available to spend on a house.
Pre-approval is a lender's actual commitment to lend to you. It involves assembling the financial records mentioned in Question 19 (Without the property description and sales contract) and going through a preliminary approval process. Pre-approval gives you a definite idea of what you can afford and shows sellers that you are serious about buying.

22.What features and benefits do I need?

Your personal situation will determine the best kind of loan for you. By asking yourself a few questions, you can help narrow your search among the many options available and discover which loan suits you best.
Is the interest and costs on the loan going to be tax deductible?
Do you expect your finances to change over the next few years?
Are you planning to live in this home for a long period of time?
Are you comfortable with the idea of a changing mortgage payment amount?
Do you wish to be free of mortgage debt as your children approach college age or as you prepare for retirement?
Your lender can help you use your answers to questions such as these to decide which loan best fits your needs.

23. WHAT HAPPENS AFTER I'VE APPLIED FOR MY LOAN?

It usually takes a lender between approximately one week to complete the evaluation of your application. It is not unusual for the lender to ask for more information once the application has been submitted. The sooner you can provide the information, the faster your application will be processed. Once all the information has been verified the lender will call you to let you know the outcome of your application. If the loan is approved, mortgage documents are sent to you for signing and are required to be returned at least three days prior to settlement

24. HOW DOES MY CREDIT HISTORY IMPACT MY ABILITY TO QUALIFY?

Greatly. Credit history is one of the major factors that influence a lenders credit decision. A minor blemish might rule out many lenders immediately. Major credit impairment may mean that only a handful of lenders will approve your loan, possibly with special conditions.Bad debts and arrears on current loans are also taken into account by lenders.

25. WHAT IS MORTGAGE INSURANCE?

Mortgage insurance is a policy that protects lenders against some or most of the losses that result from defaults on home mortgages. It's required primarily for borrowers lending more than 80% of the security value.

26. HOW DOES MORTGAGE INSURANCE WORK?

Like home or auto insurance, mortgage insurance requires payment of a premium, is for protection against loss, and is used in the event of an emergency. If a borrower can't repay an insured mortgage loan as agreed, the lender may foreclose on the property and file a claim with the mortgage insurer for some or most of the total losses. Remember the customer pays for the insurance policy which protects the lender, not the borrower.

27. DO I NEED MORTGAGE INSURANCE? HOW DO I GET IT?

You will probably need mortgage insurance if you plan to borrow more than 80% of the valuation of the secured property. There are multiple mortgage insurers and their premiums vary. Lifesaver Home Loans can negotiate on your behalf and explain your options.