Home Loan Terminology

Agent's Commission

The fee to the real-estate agent for selling the property.

Appraised Value

Estimate of the value of a property being used as security for a home loan. This is for lending purposes only.

Appreciation

An increase in value of an asset such as an existing property or block of land.

Bridging Finance

Short-term finance that covers the gap between the purchase of a new property and the sale of an old property.

Capital Gain

Profit from selling an asset at a higher market price than it cost.

Capital Gains Tax

A Federal Government tax on the monetary gain made on the sale of an asset bought and sold after September 1985.

Caveat

Notification placed on a title to warn any purchaser that someone else holds an interest in the property. This ensures it is not sold without the consent of this third party.

Caveat Emptor

Latin for ‘let the buyer beware’. In other words, the buyer has the responsibility to examine the goods being purchased.

Certificate of Title

Records your ownership of a piece of property.

Cooling-Off Period

The amount of time either the buyer or seller has to change their minds in a private sale. This doesn’t apply if you buy or sell at an auction.

Common Property

A part of the property that is for the use of all tenants.

Comparison Rate

An adjusted interest rate that takes into account the lenders' fees and charges over the term of the loan.

Conveyance

A legal document by which the ownership of property is transferred.

CRAA

Credit Reference Association of Australia, used by lenders to check credit history.

Deposit Bond

A guarantee that can be used instead of having to provide cash for the usual 10% deposit on a property purchase.

Equity

The difference between the value of your home and the amount that is owed on your home loan.

Exchange of Contracts

When the buyer and seller swap contracts of sale.

Fittings

Items that can be removed from the property, such as furniture.

Fixtures

Items that are part of the property, such as baths, dishwashers and curtain rods.

Freehold

Freehold land is land that is not leased from the Crown (government).

GST

A 10 per cent consumption tax levied on the final consumer of the goods or services.

Guarantee

A promise by a third party to meet a borrower’s payment obligations if they are unable to pay. It is often secured by the guarantor’s own property.

Holding Deposit

A refundable goodwill deposit to show a buyer's intention to purchase.

Home Equity Loan

A loan which allows you to access the equity that you have built up in your home.

Inclusions

Items included in the property, such as light fittings, which should be listed in the contract.

Interest-Only Loan

A loan where the borrower only pays interest on the loan over a pre-determined period, e.g. 5 years, instead of interest plus principal. At the end of the period, the loan usually reverts to principal and interest for the remainder of the loan’s term.

Land Tax

An annual tax paid to the state government, calculated according to the value of the property.

Lender's Mortgage Insurance

Paid by you to the lender to ensure that the lender is covered if you default on your repayments and the lender suffers a monetary loss if they have to sell your home, e.g. the sale price is insufficient to cover the home loan debt.

Line of Credit

A transaction account that has a credit limit attached to it. The borrower can generally withdraw funds at any time, up to the credit (or facility) limit. There is usually no fixed repayment schedule however the borrower is usually required to make payments to at least cover the interest and fees on the loan.

Mortgage

The document recording that a property is security for the money borrowed to purchase it.

Mortgage Broker

A broker helps find the right loan for your needs from a selection of lenders.

Negative Gearing

When the tax deductions from an investment property exceed the income the property generates, the investor has a tax loss to offset against their other taxable income.

100 per cent Offset Account

A savings account linked to your home loan which can help to reduce the amount of interest payable on the loan.

Off-The-Plan

Buying a property prior to construction taking place.

Option

A legal method by which a purchaser may reserve a property for a period of time under mutually agreed terms. This sometimes includes financial penalties, so discuss with a solicitor before entering into any option arrangement.

Passed In

When a property fails to sell at auction, it is said to be 'passed in’ at the highest bid.

Private Treaty Sale

A real-estate agent finds a buyer without going to auction. A price is set and prospective purchasers can submit offers that are usually below the asking price.

REI Contract

Standardised ‘plain English’ contract used as the basis for home and land transactions. Can be amended with special clauses to suit buyers and sellers.

Redraw Facility

Feature of a loan that allows borrowers to access any additional repayments they have made.

Reserve Price

The minimum price that the vendor will sell the property for at auction.

Semi-Detached

A house that shares a common wall with another house.

Settlement

Money paid in full in exchange for title documents, keys and the right to take possession.

Strata Title

The concept of ‘layer upon layer’ - lots, stacked one on top of the other, e.g. a block of units. Each unit relates to a ‘lot’ in the Strata Plan.

Term

The length of time over which a home loan is repaid, generally 25 or 30 years.

Term Deposit

A type of savings account where the size of the deposit, the interest rate, and the length of time the money is deposited for, are all fixed.

Title Deeds

Formal documents signifying ownership.

Torrens Title

The system of title that applies to most land in Australia.

Transfer of Land Duty

A state government stamp duty on property purchases calculated on the purchase price.

Valuation

A report which details the value of your property.

Variable Interest Rate

A rate that varies in accordance with the rates in the marketplace.

Vendor

The party offering a property for sale.

Zoning

Used by local authorities to control use of property, e.g. residential or retail.

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Services Videos

At Reliance Home Loans, we have been privileged to have worked with hundreds of remarkable individuals and families.

Very few things come close to receiving their genuine appreciation of our services.

All we can say in return is - the pleasure was all ours.

 

It is also our pleasure to share some client testimonials with you. Please click on Video Testimonials to view them all. Use the buttons at the bottom of the screen to navigate through the videos.
Want a quick and entertaining snapshot of our services? Click on Services Videos and enjoy!
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Testimonials

  • "Singh Sahib, Thanks for everything. Really appreciate your wonderful support and help."
    N & V Kaushik

  • "I would like to place on record my sincere appreciation of the way you have explained loan eligibility criteria, terms and conditions and other related information. Your passion, sincerity and commitment are highly appreciated. I understand my daughters,are already in touch with you. We are earnestly happy and confident in processing complete bank loan through you company. I am gratified to hear that you obtained loan sanctioned accurately on day as promised. Your cordial behavior and prompt response are highly appreciated."
    R Trivedi

  • "Sewa and Ajay were outstanding. My partner and I didn't really know what was involved when it came to purchasing our first home. There are so many things to consider and so many things to remember and it all became quite overwhelming. We were then recommended to talk to Sewa and Ajay and we immediately felt at ease and as though we had someone on our side. Their dedication to us and their patience was nothing short of amazing. No question was too silly for them to answer. We felt cared for and confident as they guided us through the process and looked after us every step of the way. We are now very happy home owners and couldn't be more grateful to the team at Reliance Home Loans. They go above and beyond to look after their clients."
    K McGrory & C Moon

  • "I like to thank you so much for your help with the setup of our loans, the way you had structured it is working really well for us.... couldn’t have done it without your help, you have made it so easy and your attention to details is next to none! You guys have been very prompt and responsive towards all my queries and requests... we really appreciate your hard work, well done!"
    C La & S Ha

  • "Thank you very much for the efforts you have made to wave out annual fee on my mortgage . And refinancing my properties. Great job, may God bless you to give more strength to help the community ."
    D Raju

  • "We would like to take this opportunity to thank you for helping us in buying our first home. You have been very enthusiastic, helpful and honest in our dealings during the whole buying process. You cleared all our doubts and answered all our questions about the loan process and made us feel at ease. We are very happy with the loan options and thanks for getting us a great deal. As a first home buyer we didn’t know anything about property buying and you explained us everything which eventually led us to buy the property. We will surely recommend you to all our friends and relatives. Thanks once again and keep up the good work."
    K & H Garg

  • "On behalf of my family, I would like to thank you for sparing so much time, during my last Sydney visit. I really appreciate the fact that you heard us carefully and advised us diligently while sharing your expertise and insight about real estate investments nitty-gritty. You are clearly enthusiastic about your work and it was encouraging to understand your approach to sharing facts/ experiences that felt me feel lucky meeting you timely.
    We wish you Grand Good Luck and Thunder Fortune for all your future ventures, and hope to meet with you again."
    R Trivedi

  • "Its a pleasure to know someone like you. A sincere and kind friend like you is hard to find. You undoubtedly have been a part of our life for a long time. We always look towards you for any professional and financial advise and have always felt that you have helped us beyond the call of your duty. I just want you to know that all these little favours that you have extended have not gone unnoticed by us. We are very much aware of your extended help and support. Thanks once again for being there when we needed you."
    G & R Handa

  • "This is in regards to my current loan transfers, setting these loan account and getting a very good discount for my loans. You have done a tremendous job. I am really benefited with your service. You have very good knowledge about the different banks and their loan structure. You also have a good reputation with these Banks(lending team). A senior BDM from lending team where my loans are, has very good regards for you and for your professionalism. I highly recommend you and your company for home and business loans."
    A Sanap

  • "We wanted to thank you very much wholeheartedly once again for all your support, guidance and assistance in getting us a loan to purchase our first home. We really appreciate all the time and effort you put in for us and that you continually went above and beyond. We are thoroughly enjoying being the new owners and love our house."
    F Rappoport & T Wells

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