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Home Loan FAQs

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You've got questions, we've got answers. Read our FAQs for more information.

Ask MYCU

  Do I have to be a member to take out a loan? 

Anyone can enquire or apply for a loan with us - you don't have to be a member at the time. You will need to become a member when you take out the loan. We are a mutual financial services organisation whose shareholders are its members, and you must be a member before you can take up a product or service with us.

  How much can I borrow?

The amount you can borrow is dependent on the type of loan you apply for. The actual amount you can borrow is, however, determined by your ability to meet the repayments of the loan and the value of the loan security.

  What does a comparison rate mean?

The Comparison Rate is an indicative interest rate that is designed to help you identify the 'true cost' of a loan. It takes into account the interest rate and any 'ascertainable fees and charges' that relate in an attempt to express some of the costs of a loan into a single rate. 'Ascertainable fees and charges' are those that are definitely payable during the life of the loan - such as application fees, monthly or annual charges, cost of valuation and legal fees.

What isn't included?

The Comparison Rate does not include fees and charges that may occur or are based on some future 'event' - such as redraw, early termination fees, progress payments or fees charged by some institutions when you decide to switch lenders. In addition, government and statutory charges are not included - as these are standard irrespective of the type of loan or who the lender is. So, whilst the Comparison Rate is a useful tool for comparing the cost of different loans, it should be remembered that it doesn't provide the total picture.

What to bear in mind? 

It's important to consider all the features and benefits of the loan - rather than only focusing on the Comparison Rate. A Comparison Rate does not take into account all the factors that should be considered when comparing different loan offers from different financial institutions/lenders. Benefits such as redraw, 100% offset and the ability to make additional repayments/flexible repayment periods are not included within a Comparison Rate - but they can make a difference to the attractiveness of a loan.

  How often will I receive information on my account?

Statements are issued quarterly. More frequent or duplicate statements can be requested at any time from our office. Account information is also available 24/7 through our Mobile Banking App, Internet Banking and Phone Banking services.

  What costs do I need to consider?

Deposit

The biggest initial cost is the deposit. This will range from 5% to 30% of the value of the property depending on the type of loan you require.

Property purchase stamp duty & registration fees

Property purchase stamp duty is a form of government tax and is calculated on the market value of the property or the purchase price, whichever is greater. You may be exempted or eligible for a concession, please contact your solicitor/conveyancer.

In addition, whenever a property changes hands, the change of ownership must be recorded with the appropriate State Titles Office. A document known as a Transfer of Land must be lodged, the cost of which varies in each State/Territory. Please contact your solicitor/conveyancer who should perform this task on your behalf. 

To check out the stamp duty on the property you are looking at, use our Stamp Duty Calculator.

Mortgage stamp duty and registration fee where applicable

Stamp duty is incurred to make mortgage documents legal. The fee is determined by the amount you are borrowing. We will calculate your loan security stamp duty and will pay the applicable state authority on your behalf. You will be charged a cost.

There is also a government charge to register your mortgage document. We will pay the applicable state authority on your behalf. You will be charged at cost.

Legal Fees

Legal expenses for the average home purchase include (indicative only):

  • Solicitor fees (between $500 - $2000)
  • Survey and building certificate ($450)
  • Building inspection and pest report ($400 - $500)
  • Property Valuation ($300 - $500)

Searches and inspections

Contracts should never be exchanged until the necessary searches and inspections have been completed. Searches and inspections may include the following:

Title search

A Certificate of Title obtained from the Titles Office by your solicitor/conveyancer provides details of who owns the property and who else has an interest in it. This is a good way to research if there are any mortgages, caveats, restrictive covenants etc on the property which would affect the transfer of title.

Building inspection and pest report

The report completed by your building inspector will detail any building flaws, e.g. structural issues with the building or roof, damp etc. The pest report should detail any evidence of pest infestation. It will enable you to assess the cost of any required treatment.

  How do I make repayments on the loan?

You can arrange to make your loan repayments either by:

  • payroll deduction; or
  • direct debit from your savings or transaction account.

If you want to make payments in addition to your agreed monthly payment, you can make payments:

  What security is required to take out a Home Loan? 

Your loan must be secured by a registered mortgage over a residential owner occupied property.

  What happens if I get sick, have an accident or lose my job?

The best way to obtain peace of mind that your repayment obligations will be met in the case of accident, illness or involuntary unemployment is to take out Loan Repayment Insurance.

  Do I need to take out insurance?

Lenders Mortgage Insurance will be required if the amount of your loan exceeds 80% of the valuation or purchase price, whichever the lesser.

Building Insurance is required to be taken out equal to the amount stated in the recommendation on the property valuation.

You can take out Loan Repayment Insurance on your loan for your peace of mind. This insurance is designed to cover your lending obligations in the case of sickness, accident or involuntary unemployment. Although you do not have to purchase your insurance through us, we do offer a range of insurance policies to suit your needs.

  What is Loan Repayment Insurance?

Loan Repayment Insurance provides you with the peace of mind that if any unfortunate event, such as your death, disability, involuntary unemployment or trauma occurs, your assets will be safe and your loan repayments will be taken care of.

  Are you eligible for the First Home Owner's grant? 

The First Home Owner Grant is a government incentive and was established to assist eligible first home owners to purchase a new home or build their home. The grant is $15,000 and is only available for new homes. It is set to decrease on 1 January 2016 to $10,000. The grant is useful as it can be used to offset the cost of stamp duty.

What is a new home?

A new home:

  • has not been previously occupied;
  • has not been previously sold as a residence; and
  • has been substantially renovated and a home built to replace demolished premises.

Am I eligible?

To be eligible for the $15,000 grant:

  • the contract date must be on or after 1 October 2012;
  • the home is a brand new home;
  • you are over 18; and
  • you or your partner have never held a relevant interest in any residential property in Australia prior to 1 July 2000.

For full information about whether you will or will not be eligible for the First Home Owners grant visit http://www.osr.nsw.gov.au/grants/fhog

 

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