FAQ’s
Why choose Primestone Financial Services instead of going directly to the bank?
We hear this question a lot, and it’s a fair one.
Life is busy, and visiting multiple banks or researching dozens of loan products can be time-consuming and overwhelming. That’s where Primestone Financial Services steps in to make things easier.
We compare a wide range of home loan options from banks, credit unions, and building societies — saving you hours of legwork. Our qualified, accredited home loan specialists will guide you through the entire application process and help you choose the option that best suits your needs.
“We’re not just mortgage brokers — we’re mortgage strategists helping you build long-term wealth.”
How much deposit do I need for a home loan?
The required deposit typically ranges between 5% and 20% of the purchase price.
- A 20% deposit is ideal as it avoids Lenders Mortgage Insurance (LMI).
- If you only have a 5–10% deposit, you may still qualify but will likely need to pay LMI or meet stricter lending criteria.
For example:
If you’re buying a property worth $600,000:
- A 20% deposit = $120,000
- A 10% deposit = $60,000 (but LMI likely applies)
Some government schemes (e.g., First Home Guarantee) allow eligible buyers to purchase with a 5% deposit without LMI.
What is Lenders Mortgage Insurance (LMI)?
LMI is a one-time insurance premium paid by the borrower when they borrow more than 80% of the property’s value (i.e., when they have less than a 20% deposit).
It protects the lender, not the borrower, in case you default on the loan.
LMI can cost thousands of dollars, depending on the loan amount and deposit size. Some lenders allow you to add the LMI to your loan, but it increases your repayments and total interest payable.
What are the types of home loan interest rates?
There are three main types of interest rates:
✅ Variable Rate Loans
- Interest rate can go up or down over time.
- Offers features like extra repayments, offset accounts, redraw.
- More flexible and suitable for borrowers who want to pay off the loan faster or have access to equity.
🔒 Fixed Rate Loans
- The interest rate is locked in for a set period (typically 1–5 years).
- Repayments stay the same, providing certainty and budgeting ease.
- Less flexible – often limited or no extra repayments, break fees if you exit early.
🔁 Split Loans
- Combine both fixed and variable rates in one loan.
- Offers the certainty of fixed repayments with the flexibility of variable.
What is a comparison rate and why is it important?
A comparison rate reflects the true cost of a loan, including the interest rate plus most fees and charges (e.g., application fees, monthly account fees).
This helps you compare loan products on a more like-for-like basis.
For example:
- Loan A: 5.70% interest rate, 6.05% comparison rate
- Loan B: 5.85% interest rate, 5.95% comparison rate
Loan B may be cheaper in the long run despite a higher interest rate.
Can I refinance my home loan?
Yes. Refinancing involves replacing your current home loan with a new one—either with your existing lender or a different one. Reasons to refinance include:
- Getting a better interest rate
- Lowering monthly repayments
- Accessing equity for renovations, investment, or debt consolidation
- Changing loan types (e.g., from fixed to variable)
Things to consider before refinancing:
- Exit/break fees (especially for fixed loans)
- New application or valuation fees
- Your current financial situation
- Loan features and comparison rate
What assistance is available for first-home buyers in Australia?
There are several government incentives to help first-time buyers:
🏠 First Home Owner Grant (FHOG)
- A one-time grant available in most states/territories for newly built homes.
- Amount and eligibility vary by location.
💸 Stamp Duty Concessions
- Many states offer full or partial stamp duty exemptions or discounts for eligible first-home buyers up to a certain purchase price threshold.
🛡 First Home Guarantee (FHBG) – Formerly First Home Loan Deposit Scheme
- Allows eligible buyers to purchase with just a 5% deposit without paying LMI.
- Available through specific lenders with capped places annually.
💰 Super Saver Scheme
- Allows eligible first-time buyers to withdraw voluntary super contributions to help fund their deposit.
Check state government websites or NHFIC.gov.au for up-to-date information.
What documents do I need to apply for a home loan?
Lenders will require evidence of your financial position. Common documents include:
Personal Identification:
- Driver’s license or passport
- Medicare card or birth certificate
Proof of Income:
- Recent payslips (last 2–3)
- Most recent tax return and group certificate
- Centrelink statements (if applicable)
Assets & Liabilities:
- Bank account statements (savings, credit cards)
- Superannuation balance
- Details of other loans or debts
- Rental income or investment details (if applicable)
Property Documents (when purchasing):
- Contract of sale
- Details of property and deposit
How much can I borrow?
This depends on several factors, including:
- Income and employment status
- Existing debts and expenses
- Credit history
- Loan term
- Interest rates
- Number of dependents
To get an accurate estimate:
“Use our Borrowing Power Calculator or speak to one of our Home Loan Specialists for a personalised assessment.”