Whether it's your First Home, Next Home or Dream Home, we're on your side

Finding the right home loan can feel overwhelming, especially with so many options available. At Total Choice Home Loans, we specialise in helping clients with the best service Australia wide as well as expats overseas. Our expertise ensures that you find a loan suited to your unique financial situation, whether you're buying a home for the first time or looking to refinance. Let us guide you through the process of applying for a home loan, making it as straightforward and stress-free as possible.

Understanding the home loan process is crucial. Firstly, assessing your borrowing capacity is essential. This involves reviewing your credit history, bank statements, and overall financial situation. Your borrowing capacity determines the loan amount you can access and influences the terms offered by lenders. Various factors like the loan to value ratio (LVR) and home equity play significant roles here. LVR is the amount of your loan compared to the value of the property, and a lower LVR can often lead to better interest rate discounts.

Interest rates are another vital aspect of home loans. Choosing between a fixed interest rate home loan and a variable interest rate is an important decision. Fixed interest rate home loans provide stability by keeping your repayments unchanged over a set period. On the other hand, variable home loan rates can fluctuate according to market conditions, potentially offering savings if rates decrease. Calculating home loan repayments with these variables in mind helps you understand what fits within your budget.

Lenders mortgage insurance (LMI) is another consideration when applying for a home loan. If your deposit is less than 20% of the property's value, LMI may be required to protect the lender against potential default. This insurance impacts the overall cost of your loan and should be factored into your financial planning.

Stamp duty is an additional cost when buying a home in Fremantle, WA. This government tax varies based on the property's value and must be included in your budgeting process. Understanding your total costs upfront will provide a clearer picture when deciding on a suitable home loan option.

Getting pre-approved for a home loan can give you a competitive edge in the property market, allowing you to act quickly when you find the perfect property. A home loan pre-approval indicates to sellers that you are a serious buyer with a solid financial standing.

At Total Choice Home Loans, we offer a streamlined application process to simplify your experience. Our team provides guidance on everything from filling out your home loan application to understanding how an offset account can help reduce interest over time. We work with you to ensure the application process is efficient and transparent.

In summary, securing the right home loan involves careful consideration of various factors like interest rates, borrowing capacity, and additional costs such as LMI and stamp duty. Total Choice Home Loans is committed to helping our clients from our HQ in Fremantle access suitable home.

loan options from banks and lenders across Australia. Let us assist you with applying for a home loan and achieving your property goals. Contact us today to get pre-approved and take the next step towards owning your dream home.

Loan Types

When looking at different Home Loan Options, it's important to understand some of the key loan attributes:

• Principal and Interest: This is the most common type of Home Loan. With a principal and interest Home Loan, you not only pay the interest on the borrowed money but also a portion of the actual loan amount. It means you're slowly paying off the loan while also covering the interest.
• Interest Only: With an interest-only Home Loan, you only pay the interest on the borrowed amount for a certain period, usually around 5 years. This can make your initial repayments lower, but keep in mind that you'll still need to pay back the full amount later on.
• Variable Rate: On the other hand, a variable rate Home Loan means the interest rate can change over time due to various factors like changes in the economy. While it might offer flexibility and potentially lower interest rates, it could also mean that your repayments may vary.
• Fixed Rate: A fixed-rate Home Loan means the interest rate stays the same for a set period, often 1 to 5 years. It provides stability and predictability because your repayments won't change during this time, making it easier to budget.
• Introductory Loan: The interest rate is usually low to attract borrowers. Also known as a honeymoon loan, this rate generally lasts only for a few years before it rises. Rates can be fixed or capped. Most revert to the standard rates which can be higher than packaged loans with offset and ongoing discounts for the long term. These can be useful when the loan is only expected to be required for a few years, or a lump sum reduction is anticipated within the first 24 months. Honeymoon rates do not normally include an offset option.

Loan Features

There are some common loan features provided by lenders explained briefly below, but more detailed explanation and comparison of the pro and cons of these can be provided by Total Choice when you are ready to look at your own options.

100% Offset Transaction Account

A 100% offset account is a transaction account linked to a loan account. No interest is paid to the offset account but instead the daily balance of your offset account is deducted from your daily loan account balance before the interest on your home loan is calculated. Therefore less interest is charged to your loan if you maintain a balance in the offset account.

Pros:

• Savings interest is taxable, but because your offset account balance is used instead to reduce your loan interest, no tax is payable, so you are effectively reducing your tax bill.
• The interest rate on your offset account is the same as that applied to your loan account.
• This is a great rate and is much higher than you could earn on most savings accounts. The interest rate moves with your loan account rate ensuring you get maximum benefit from every dollar in your offset account.

Cons:

• You may have higher interest rate on the offset product, and monthly fees may be attached to the account.
• You may need a minimum balance in the account.
• Most lenders only offer the offset feature on a variable interest rate.

Redraw

A redraw facility is a loan feature that allows borrowers to access any extra repayments they have made on their loan. If you've paid more than the required minimum repayments on your mortgage or loan, you can "redraw" those additional funds if needed.

This can be useful for managing unexpected expenses or making additional investments while still reducing your loan balance over time.

The Loan Processs

1. Consultation with Your Mortgage Broker

Your journey to securing a property loan begins with an initial consultation with Jonathan, the Principal at Total Choice Home Loans, with over 20 years Mortgage Broking experience. This can be organised online with Zoom or Teams or at the HQ office in Fremantle. Whether you're buying a first home, upgrading to a bigger home, considering buying an investment property or commercial real estate, Jonathan will discuss your property goals, explain the application process, and assess your current financial situation. This meeting sets the stage for finding the right loan options. Jonathan will also outline various loan types from banks and lenders across Australia, helping you access the best deals. To provide you with options and make the consultation a productive meeting, we will require you to provide us with some initial information so we can do some preparation. All personal information is held securely with 2FA protection and kept safe.

2. Financial Assessment

Jonathan will thoroughly evaluate your financial situation, including your income, expenses, assets, liabilities, credit history, and home equity. This comprehensive assessment is crucial to determining your borrowing capacity and the loan amount you can apply for. Your broker will help you understand key financial terms like loan-to-value ratio (LVR), interest rate discounts, and lenders mortgage insurance (LMI) that might apply based on your specific financial position. Any government incentives can be analysed and discussed at this time.

3. Exploring Loan Options

After assessing your financial situation, Jonathan and the team will compare various loan products from multiple lenders, considering your requirements and objectives with factors like interest rates, fees, repayment terms, and loan features. Jonathan will also help you understand the differences between fixed and variable loan rates, offset accounts, funding requirement, costs to purchase and the implications of each option on your future repayments. The aim is to find a loan that best suits your needs, whether you're looking for a home loan, investment loan, or a loan to fund another property purchase. We also try to educate you throughout the process so you have a better understanding of what is going on.

4. Pre-Approval Process

One of the first major milestones is receiving loan pre-approval. Most real estate agents will want to know you are ready to purchase with a valid lender pre-approval. This process involves getting an initial indication from a lender regarding how much you may be able to borrow. Pre-approval helps you set a realistic budget and gives you more confidence when making offers on properties. It also strengthens your position in the local property market, showing sellers that you’re a serious buyer. We also find this cements your conviction to be able to make the next step in making an actual offer on a property, or house and land package.

5. Submitting the Loan Application

After choosing the loan product that works best for you, Jonathan and the team will assist you with the formal loan application. They will manage the paperwork, request any necessary supporting documents such as bank statements, and submit your loan application to your chosen lender. The Total Choice Team will liaise with the lender throughout the application process, keeping you informed about the progress and addressing any issues that arise. Once you have had an offer accepted, we will work with all parties to ensure a smooth transition to formal approval and settlement. The Total Choice (TCHL) Team will work with the lender, real estate agent, settlement agent, government bodies and other parties to make sure there are no surprises.

6. Loan Approval & Final Steps

Once your loan is approved, the TCHL Team will guide you through the next steps. This typically includes reviewing the loan agreement, ensuring all terms and conditions are understood, and arranging for any additional insurance coverage, such as mortgage insurance. The team will also help you set up repayment options and advise on strategies for managing your loan effectively over time.

7. Property Settlement & Ownership

Once all the documentation is in order, the final settlement takes place. This is when the loan is formally advanced, and ownership of the property is transferred to you. Your settlement agent will be responsible for ensuring all the monies are distributed and contracts finalised with the titles changing hands on settlement day. We have several settlement agents who offer an excellent service we work closely with to ensure all communication and professional service is maintained at all times as we transition the process to them to finalise. After settlement, your lender will typically offer online access to your loan, and you’ll begin managing your loan repayments, helping you stay on top of your financial commitments. Total Choice will be able to assist with where to find the right information and depending on the lender can assist with setting up accounts. After settlement you can always check in with our team to query anything.

8. Loan reviews

Total Choice Team will periodically reach out to offer a review of your loan interest rate and as your personal circumstances change over time, we find your loan requirements will also change, so we are available to chat again in the future to discuss any new lending requirements you may have. We find that our happy clients will return and as we already have a relationship with you, we can act faster to provide updated advice and information to you. We provide an ongoing relationship with you, not just a transaction. We do not normally charge for our services as the lender will pay us if the loan settles. This is not a fee added in your loan contract but all commissions we receive are disclosed to you regardless of where they are paid.

9. Protecting what's important

An often-overlooked aspect of the home buying process is to look at your own personal safety net, or risk insurance. What happens if something goes wrong down the track with health issues of either the income earners, or the child carer, life can be turned upside down very quickly. We do not directly provide risk insurance advice, but we do know from direct experience of what can happen when you or your partner has a health issue affecting capacity to work or care for dependants. We strongly recommend having a look at your personal risk insurance levels, which can be reviewed and (increased) or adjusted to suit your new debt commitment, to protect your equity in case of illness, sickness or injury. We have worked with professionals who can provide this advice (initial consultation is complimentary) for many years and will be able to help get this advice with a non-pushy qualified Financial Professional. This is a service additional to our main business, but we feel very important to not overlook in this process.