Matching a suitable mortgage to your needs may save you thousands interest payments over the life of your loan

With so many loan products available you can be sure there’s at least one that matches your situation. In your hunt to track down a suitable mortgage, here are a few points to keep in mind.

How much should I borrow?

Banks will determine how much they are willing to lend you based on a number of criteria; however, that doesn’t mean you should take the maximum amount they offer. Closely examine your finances to determine what you can afford to spend. Be honest and work out a realistic budget, factoring in all regular commitments, such as school fees, car payments, and food, as well as all those entertainment expenses. What’s left can be channelled into any mortgage repayments.

What type of buyer are you?

Your personal situation will determine what mortgage suits your needs, as well as what type of products are actually available to you. Are you a first time buyer, for instance, or are you refinancing an existing debt? Perhaps you’re looking for solid capital growth in an investment property or the home you’ll spend the rest of your life in? It’s important to consider why you’re buying and finding a mortgage that complements that.

Do your homework

Speak with your mortgage broker – they’re in a great position to help you compare different loans and lenders to see how they suit your circumstances. Decide what loan features you require to meet your objectives – for example are you looking for flexibility to pay off your mortgage quickly? – and then go in search for a suitable deal. Some of the most common loans that may meet your requirements include:

Fixed rate - can help soften impact of any future rate rise
Split rate - offers the security of fixed rate with the flexibility of a variable rate
Line of credit - good for financing renovations or additional property investments
Lo-doc - for the self employed, usually require less documentation, such as establishing proof of income
No deposit - can’t save for a 20% deposit? This loan will let you finance 100% of the purchasing price, although usually with a parental guarantee
Interest-only - popular for investors who don’t want to pay the principle component of a mortgage. Usually lower repayments amounts, leaving room to pursue other investments
Construction - for additions or building your own home

There are a range of tools now available, such as the internet, to help research, compare and contract loans. For many borrowers, however, lending advice from a broker is the easiest and usually most effective option for avoiding confusion and finding an appropriate loan for your needs.

About Nick Aves

Nick began his career in the finance industry more than 30 years ago as a trainee. His natural ability and interest saw him move up quickly into more substantial roles within the banking industry until he was in charge of complex business lending portfolios in excess of $65 million. In 1998 Nick put his extensive business development knowledge to use, purchasing the Dear Friends Restaurant in the Swan Valley. Under his leadership and commitment to customer service the restaurant went on to become a leader in the industry, winning numerous awards for excellence. Selling the business in 2002, Nick moved back into the finance industry as a broker giving customers the benefit of his personal experiences in business finance and development. Nick’s devotion to his work has seen him receive PLAN Australia’s Sales Master Award every year since its establishment in 2005. He was also recognised in the MPA top 100 brokers of Australia in 2007. With a Diploma in Financial Services and a proven track record in the banking and finance industry as well as private business, Nick is ideally placed to offer sound professional advice and guidance to personal and business customers, enabling them to achieve success in today’s complex and competitive financial and business world. Nick is a firm believer in the value of getting your finances in order with the correct investments, loans and insurance to enable you to spend more time doing the things you love, which in his case involves setting sail upon the Indian Ocean