How does a mortgage work?
A Victorian mortgage, one for any kind of land use in Victoria, is the same as a mortgage in any other state or territory in Australia. When you’re looking for a mortgage in Victoria, there are two main types to choose from:
- Owner Occupier. An owner occupier home loan is one for regular or traditional owners, who are borrowing money to buy a home they intend to live in.
- Investment. An investment home loan is one where the borrower is looking for a mortgage to buy an investment property, whether it be residential, commercial or for a housing development.
If you’re looking for the right mortgage in Victoria for you and your family, the type and amount of mortgage repayments and interest rates will also be high on your list. There are two kinds of interest rates with all mortgages in Victoria:
- Fixed home loan. With a fixed home loan, the interest rate, and therefore the mortgage repayments, will stay the same over the agreed fixed period, which is usually between 1 and 5 years.
- Variable rate home loan. With a variable mortgage, interest rates, and therefore mortgage repayments, can increase or decrease over the life of the loan. Internal and external variables such as the costs to the bank or lender delivering you the loan, and the state of the national or international economy, can impact on the rise and fall of interest rates of your home loan.
One way to find a suitable interest rate for you and your family is with Mortgage House’s Best Rate Mortgage Calculator (below). Simply enter the estimated value of the property you are looking to buy, how much you want to borrow, what kind of home loan you want and what type of interest rate you prefer. The calculator will list Mortgage House home loans that may be suitable and their interest rate amount. You will also discover the mortgage repayment options with each home loan, what the annual fees may be and what the comparison rate is. A comparison rate is required by law and is an indication of what the home loan may cost you over its entire life, with fees and charges taken into account.
Best Rate Mortgage Calculator
Important Disclaimer: This information is intended as a guide only. The calculation of fortnightly and weekly instalments varies with the specific loan product. Higher loan repayments will be required on principal and interest loans where the instalment calculation is based on half the monthly payment for a fortnightly payment or a quarter of the monthly payment for a weekly payment. Details of terms and conditions, interest rates, fees and charges are available upon application. Mortgage House's prevailing credit criteria apply. We recommend you seek independent legal and financial advice before proceeding with any loan.
Most mortgages will include a range of separate fees and charges over the life of the loan, and the most common mortgage is one that requires a deposit of about 20%. However, Mortgage House has a range of low deposit home loans that may be suitable for you and your family.
Who can witness mortgage documents in Victoria?
When you’re successful in applying for a mortgage in Victoria, the paperwork doesn’t end there. It is important to choose a solicitor for conveyancing work, to help you formalise the transfer of the property you are buying. No matter where you live in Victoria, there should be one nearby. They will get the documents ready for you and a witness to sign. The witness must be someone who sees you sign the documents. Who can witness your signature can vary across the country, but it is an important question to ask your solicitor before it comes time to sign the documents. The witness may be the solicitor or conveyancer themselves, or it may be another kind of lawyer. A Justice of the Peace may also be a valid witness, as can a notary public, which is someone who is given witnessing rights in law. Importantly, factor the price of the conveyancer or solicitor into your budgeting if you are looking for a mortgage in Victoria. It may not be one of the largest costs of buying a home, but it can come as a shock if you don’t expect it – and it is a key part of the entire process.
How much mortgage in VIC can I afford?
When it comes to looking for a mortgage in Victoria, most people are keen to know how much they can afford to spend. Mortgage repayments can vary depending on what kind of mortgage you choose, what the interest rates are and even how much mortgage insurance you are after. A great place for home owners to start, however, is with a Borrowing Calculator. A Borrowing Calculator, such as the one below, can give you a good indication of what your borrowing power might be. Borrowing power is an indication of how much a bank or lender may be prepared to lend you for a mortgage in VIC. Importantly, the information you receive from a Borrowing Calculator is not pre approval or conditional approval, but it can be a good and important guide. Discovering your borrowing power can help you widen, or reduce, your property search, helping you find something that is more realistic to your budget. Remember to take variables such as fees and charges into account, as well as how much your repayments will be.
There’s no point looking to borrow a larger amount of money than you are comfortable with. Speak with your financial advisor about what may be the best maximum mortgage repayments for you and your budget. Making too many sacrifices in your day-to-day life may not be worth a larger home or more prestigious address. It may pay to start smaller and work your way up. At the end of the day, our mortgage calculator range can give you the information you’re after. Once you have found a mortgage in Victoria you think may be suitable, enter the loan details – such as loan amount and term – into the Borrowing Calculator. Then, as accurately as you can, fill in your income and expenses. From there, our Borrowing Calculator will give you an indication of what you might be able to borrow, as well as how much your mortgage repayments may be.
Important Disclaimer: This is intended as a guide only. Details of terms and conditions, interest rates, fees and charges are available upon application. Mortgage House's prevailing credit criteria apply. We recommend you seek independent legal and financial advice before proceeding with any loan. The Comparison Rate for each of the home loan products contained in this page is based on a loan of $150,000 over a 25 year term. Fees and charges may be payable.
WARNING: The comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. * This mortgage calculator shows indicative repayments based on 12/26/52 equal repayments for monthly/fortnightly/weekly options.
How long does it take to pay off a mortgage?
When it comes to mortgages in Victoria, or any other state, the question of how long it will take to pay off a mortgage is a common one. While most banks and lenders will offer home loans for up to 30 years, there are ways to pay it off sooner. What kind of mortgage in Victoria you choose can help you discharge your mortgage before the maximum loan period, potentially saving you thousands of dollars. Some home loans include features that can help you pay off your mortgage sooner or save you money, including:
- Additional repayments. Making extra repayments is the most obvious way to pay off your home loan sooner, which leads to paying less in interest repayments over the life of the loan.
- Redraw. If you like the idea of making extra repayments but aren’t sure if your budget will stretch that far, redraw could be the perfect feature for you. It allows you to withdraw, at any time and for any reason, any additional repayment or lump sum payments you have made. It means you can repay more than the minimum amount and still have the security of accessing that money if you need it.
- Offset account. Having an offset account means you can save on interest over the life of the loan. A non-interest-bearing bank account is linked to your home loan, and interest is calculated on the difference between the two, not the full loan amount. Any interest you save can be turned into additional repayments.
One thing to remember when calculating your mortgage repayments is that your property purchase is likely to attract stamp duty. Stamp duty is charged on most mortgages in Victoria under the Transfer of Land Act, with home owners charged a fee for the transaction. How much you pay can vary on what kind of home you buy and where you live in Victoria. Use our Stamp Duty Calculator below to work it all out, and then add that figure to your mortgage repayment calculations.
Stamp Duty Calculator
How much are mortgage repayments?
When choosing a mortgage in Victoria, the first piece of information most would-be home owners look for is how much their mortgage repayments may be. The good news is that information is relatively easy to come by, especially if you are looking for a Mortgage House home loan. Our Mortgage Repayment Calculator below can help you save, whether you are buying a house to live in or an investment property. It automatically adjusts mortgage repayments for all home loans and is simple to use. All you need to do is enter the loan amount, loan period, interest rate and the type of mortgage you are looking for.
It is important to work out whether the interest rates attached to your preferred home loan options are introductory or not. All this information is available when you click on any of Mortgage House’s home loans, or from our specialist lenders. Once you have that information, our Mortgage Repayment Calculator will reveal the weekly, fortnightly and monthly mortgage repayments, as well as how much interest you are likely to pay over the life of the loan if you stick with the minimum repayments. Our Mortgage Repayment Calculator will also show you how much of each repayment will be made up of interest and how much the principal amount.
Mortgage Repayment Calculator
Important Disclaimer: This is intended as a guide only. Details of terms and conditions, interest rates, fees and charges are available upon application. Mortgage House’s prevailing credit criteria apply. Please note that your actual fortnightly repayment would be equal to the monthly repayment amount divided by two. Weekly repayments would equal the monthly repayment amount divided by four. If you choose to pay fortnightly or weekly, your actual repayments will be higher than repayments shown on this page. You can reduce the term of your loan if you choose to make repayments fortnightly or weekly. We recommend you seek independent legal and financial advice before proceeding with any loan.