Question 1

What is a mortgage broker?

Accepted Answer

A mortgage broker serves as a liaison between you and potential lenders. In order to offer loan solutions with competitive products and interest rates that are best suited to your unique needs and circumstances, the broker works on your behalf and in your best interests. Mortgage brokers are licensed and regulated financial specialists.

Question 2

Why use a mortgage broker?

Accepted Answer

There are lots of good reasons why more than half of Australians now use a broker to secure a home loan. Probably the most important one that is we work for you, not the banks.

A mortgage broker has access to a large selection of products from numerous banks and lenders, instead of being limited to the product choices of a single bank. A broker will conduct an interview with you to determine your needs and goals, after which they will present you with options so you can compare interest rates, repayment schedules, and loan types. A mortgage broker will do the heavy lifting for you, saving you the time it would take you to shop around with several lenders for products you might not be eligible for. Using a mortgage broker can save you money and time by finding you the right loan for your circumstances.

Question 3

What makes Pegasus Finance Group different?

Accepted Answer

Our brokers have a wealth of experience and expertise on a wide range of products and policies. We can help you secure funding for home loans, investment loans, asset financing, and commercial ventures. We are not a huge conglomerate, and our boutique size means at Pegasus Finance Group you will receive the attention you deserve.

In order to assist you make an informed decision, we will guide you through your options and help you understand different products and features. We have a process in place to make sure you get the best result possible for your needs, which is why our customers give us such great feedback.

Question 4

Does Pegasus Finance Group charge fees?

Accepted Answer

We don't bill our customers for the services we provide. Our introduction of you as a client earns us a commission from the lender you've selected. When you first enquire, we will give you clear, open information about our compensation plans in general, and then specifically for the lender you select. When you first enquire, we will give you clear and transparent information about our remuneration arrangements, both generally and then specifically for the lender you select.

Question 5

How does applying for a loan work?

Accepted Answer

All of the legwork is done by our mortgage brokers. All you have to do is fill out the application and provide the necessary documentation. We will then conduct a preliminary assessment and provide you with some options to consider.

Once we know which lender you prefer, we submit the loan application online so that it can be approved quickly.

Question 6

Does Pegasus Finance Group just help me get to settlement or do they provide an ongoing service?

Accepted Answer

In addition to assisting, you in settling your loan and choosing the appropriate lender and product, Pegasus Finance Group will also offer continuous support for the life of you loan and there won't be any no ongoing fee for our service. We want to make sure that your home loan is appropriate for you both now and in the future, and we can help you with any questions you may have or changes you might want to make to your loan, such as an increase to pay for home renovations or a change in products.

We will check in with you once a year and at significant turning points in the course of your loan to see whether you are still getting the best deal, to negotiate a better rate with your current lender, or to assist you with any new financial requirements you may have.

Question 7

How much do I need to save for a deposit?

Accepted Answer

Having a bigger deposit reduces the amount of interest you will ultimately pay over the life of the loan. Your chances of receiving a competitive interest rate increase if you make a larger deposit because it poses less risk to the lenders.

It is generally recommended that you have a deposit equal to at least 20% of the purchasing price. You can, however, make a smaller deposit as this might not be possible for everyone. In most cases, this means that lenders' mortgage insurance will be necessary (see more details further on). First home buyers can make deposits as little as 5% and may be eligible for a number of government grants, subsidies and schemes to further assist them.

The amount of the deposit needed may also depend on the purpose of your purchase. To buy an investment property, for instance, rather one that you want to live in, you will typically need to save a higher down payment.

Question 8

What other costs are associated with securing a home loan?

Accepted Answer

Pegasus Finance Group does not charge a fee for its services, you will most likely incur costs related to settling your loan. There are not only fees the lender might apply but also Government charges.

You will be required to pay stamp duty, a one-time government fee based on the purchase price, when you buy a property. There are also other government fees, such as land transfer registration and mortgage registration. You must budget for your conveyancing or legal fees as well as any council, water, or strata fees that might apply.

You won't need a conveyancer if you are refinancing, so there won't be any legal fees or stamp duty to pay. However, you will still have to pay for the land transfer and mortgage registration fees, as well as a discharge fee to your current lender.

The lender might also charge costs when application for a buy or refinance. It is your broker's responsibility to explain these to you and keep costs to a low because these fees will vary from lender to lender. Lender fees will be considered in any supplied product comparison.

Question 9

Should I get a fixed rate or Variable rate loan?

Accepted Answer

The suitability of a fixed-rate or variable-rate loan is entirely dependent on your personal financial circumstances.

If you have financial constraints, fixed-rate loans mean that your repayment rates are fixed. Lower interest rates could result from market movements. Of course, the contrary is also true; if things change the other way, you might have to pay higher interest rates. If you refinance or pay off your fixed-rate loan before the term is up, you may have to pay significant break costs.

Variable-rate loans are typically more flexible because they include features that allow for changes in your lifestyle and financial circumstances. They do, however, expose you to fluctuating interest rates, which can be beneficial or detrimental.

A split loan is a third choice, covering a portion of your loan at a fixed rate and a portion at a variable rate. When viewed separately, this can aid in reducing the drawbacks related to any type of loan.

Question 10

What is LMI (Lender's Mortgage Insurance) and when do I have to pay it?

Accepted Answer

Lenders mortgage insurance, also known as LMI, is insurance that a lender takes out to insure itself against the risk of not recovering the full loan balance if the borrower is unable to meet loan repayments. When you first obtain your home loan, LMI is often paid as a one-time, non-refundable, non-transferrable fee.

LMI varies depending on the level of risk the lender takes on by loaning you money.

Question 11

What is the difference between an Offset and a Redraw facility?

Accepted Answer

A savings or transaction account that can be connected to your mortgage is called a mortgage offset account. The balance in this account "offsets" the balance of your mortgage each day before interest is calculated. You can shorten the length of your mortgage by using an offset account and reduce your interest costs.

A redraw facility is a loan feature that is usually available with variable rate home loans and some fixed rate loans. A redraw facility lets you access any extra repayments you’ve made on your home loan.

Contact one of our friendly mortgage brokers to find out more about offset accounts and redraw facilities.

Question 12

What is a pre-approval?

Accepted Answer

Home loan pre-approval or approval in principle is confirmation from a lender of your borrowing capacity. This is based on the scenario that your broker outlined to them. Pre-approval will be confirmed in writing and will be subject to certain conditions. The standard conditions are as follows:

·       A satisfactory valuation of the property being purchased
·       Final credit approval
·       Formal acceptance from the mortgage insurer (if applicable)

Additional conditions may apply depending on your personal circumstances or the lender's requirements. A pre-approval is not a guarantee of a loan offer because any conditions must be met before an offer is made. However, knowing your budget and having pre-approval can give you the confidence to buy. It will make you a more appealing buyer by demonstrating your readiness to move forwards, and it may also shorten the time it takes for a formal loan offer to be issued.

Pre-approval applications do require a credit check so it is advisable to obtain this from the lender you ultimately intend to go with to avoid multiple entries on your credit file. Most pre-approvals expire after 90 days so your broker will be in touch to renew if you haven’t purchased within that time.

Question 13

Do I Qualify for The First Home Owners Grant?

Accepted Answer

The QLD Government’s First Home Owner Grant currently stands at $15,000 towards building or buying a brand new home that is your principal place of residence. More information about the eligibility criteria can be found here.

Question 14

Should I still talk to my bank first?

Accepted Answer

There’s really no need to! We work with every major Australian Bank and Lender to find the best possible mortgage products, so we’ll be reaching out to your bank anyway. Your bank will not always have your best interest in mind. As an independent, we will get you the best possible solution today and stay with you throughout the life of your mortgage.

Frequently asked questions