LoansDirect Blog

Your Step-by-Step Guide to Mortgage Financing

February 22, 2017

Mortgage is a financial factor that troubles many with questions like how to manage it, which rate will be good and how they can save for a deposit. However, you can complete this task easily if you plan it properly. If you are confused about where to start, then here is your step-by-step guide.

    • How can you save for deposit – Firstly, you need to start with saving for the deposit. According to your income and saving capability, you can save money for the deposit within 1 or 2 years.The time-period depends on your spending habits and your current expenses.
    • How banks assess mortgage – The bank will assess your finances in order to evaluate your mortgage application. Banks usually assess applicant’s income (annual) to know how much mortgage they can afford. They will check the evidence of your repayment capacity too. You can take the help of a mortgage repayment calculator in Australia to know more about it. They will also check your expenses and any payments you make such as an existing mortgage or personal loans.Banks also check for the track-record of making payments that are equivalent to the mortgage’s monthly stressed payment.
    • How can you choose the right rate – In this, you have two options – fixed and variable. If you are interested in knowing how much you will be paying for mortgage every month, then you can choose fixed rate. However, if there is possibility that you can pay more than your mortgage on occasions, then it is advised to choose the variable rate. It will help you reduce the term of your loan.
    • What should be the term – The term depends on how much monthly payment you can afford. If you choose a longer term, you will have to pay less monthly payments, while if you choose shorter term then the payment will be higher. However, your age may also play a role as mortgage is allowed until the normal retirement age, which is 68.


Follow the aforementioned steps in order to make sure that you choose the right option that suits your requirements and affordability.

More than $75 million AUD
disbursed in loans!