Find answers to some of the most common questions from our members
Lender’s Mortgage Insurance (known as LMI) is an insurance that protects the lender in the event of default by the borrower. LMI is a one-off payment that usually occurs when more than 80% of the property value is borrowed by a home buyer. You can pay the cost for LMI upfront at settlement of your loan or it can be capitalised into your home loan.
Investment loans are funds borrowed with the intended use of creating wealth or an income source. An investment loan is mostly used for the purpose of a purchase, construction or refinance of a home that will not be owner-occupied.
The loan to value ratio (LVR) is a calculation using the amount of your loan compared to the appraised value of your property. To calculate the LVR, simply divide the loan amount by the property value.
As an example, if you need to borrow $350,000 and your property is appraised at $420,000 the LVR is 83%.
The loan term is the duration of your loan. Most loan products offer terms of up to 30 years. People’s Choice Credit Union offers loan terms of up to 40 years for eligible first home buyers.
A fixed interest rate is a locked-in rate that won’t change during a set period of the loan, so you know exactly what your repayments will be.
For a more personalised experience please enter your location below...