- Do I have to be a member of First Option to take out a loan?
- How much can I borrow?
- What costs do I need to consider?
- How do I make repayments on the loan?
- How often will I receive information on my account?
- What security is required?
- What happens if I get sick, have an accident or lose my job?
- Do I need to take out Home Insurance?
- Do I need to take out Loan Repayment Insurance?
- Is a redraw facility available?
- What is Lenders Mortgage Insurance?
- Will I need to have Lenders Mortgage Insurance on my loan?
Do I have to be a member of First Option to take out a loan?
First Option is a mutual financial services organization and as such is owned by its members, each one of whom is a shareholder. You must become a member of First Option Bank to take out a loan. However, you can apply for a loan if you are not an existing member but you will need to become a member if your loan is approved.
How much can I borrow?
Would you like to calculate how much you may be able to borrow? Use our Borrowing Power Calculator.
What costs do I need to consider?
- Registration fees
- Legal Fees
- Searches and inspections
The biggest initial cost is the loan deposit. This could range from 5% and above the value of the property.
Registration fees are payable on a property purchase and on a mortgage.
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 can perform this task on your behalf.
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 expenses for the average home purchase include:
- Solicitors fees (between $500-$2,000)
- Survey and building certificate ($450)
- Building inspection and pest report ($400-$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:
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, electronic transfer from your savings or transaction account, internet banking or using Bank@Post.
How often will I receive information on my account?
Statements are produced quarterly or more frequently on request. Duplicate statements can be requested at any time (fees apply).
Account information is also available through our Internet Banking and Easy App services.
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 insurance. Learn more about our Loan Repayment Insurance.
Do I need to take out home insurance?
Building insurance is required to be taken out equal to the amount stated in the recommendation on the property valuation.
Do I need to take out Loan Repayment Insurance?
It is recommended that you take out insurance on your loan. Although not compulsory, it is designed to cover your lending obligations in the case of sickness, accident or involuntary unemployment. Learn more about our Loan Repayment Insurance.
Is a redraw facility available?
First Option gives you the option of making extra repayments on your loan and then having the flexibility of being able to redraw on these extra repayments. Terms and conditions are available on application.
What is Lenders Mortgage Insurance?
Lenders mortgage insurance covers First Option against a loss in the unlikely event that we have to exercise our right to sell the property due to ongoing default on loan repayments. It must not be confused with insurance designed to cover your lending obligations in the case of sickness, accident or involuntary unemployment.
Will I need to have Lenders Mortgage Insurance on my loan?
You will need to have Lenders Mortgage Insurance if your loan amount is more than 80% of the value of the property being used as security for the loan.