Category: House & Home
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Sub category: Buy
 

How to speak home buying

If you’ve been to a couple of inspections, you probably have your sights set on the property of your dreams. But like most of us, you’re going to need a loan to lock it down.

The real estate industry can sometimes feel like another world altogether, and you may want to brush up on your home loan speak before dealing with real estate agents and lenders. It’s easy to get caught behind a smokescreen of property and home loan jargon, so we’ve translated some of it to help you tackle the process with confidence.

 

Market lingo

Loan term: How long you’ve agreed to make the repayments on your house.

Principal: The original amount you borrowed – without the add-ons.

Interest: It’s the percentage added to the original loan that allows you to pay it off over a longer time.

Pre-qualified: You’ve sat down with a lender and been told the dollar amount you have to play with.

Pre-approved: A bank has given you the thumbs up on the home loan and you’re ready to put your money where your mouth is come auction day.

Guarantor: This is the definition of “having your back”. A guarantor is a mate or backer that will sign to be responsible for following through on your loan if for any reason you default or are unable to pay.

Home equity: This is the amount of a home that’s actually yours. Basically, it’s the value of the house minus the amount still to pay on the loan; and it’s all yours.

Assignment: This isn’t homework. It’s when an existing mortgage is passed on to someone else.

Conveyancing: Lawyer stuff, as they work on your contract when you buy a home.

Deed: A piece of paper you’ll have to sign to ‘officially’ become a home owner.

 

Meet the players

Auctioneer: That fast-talking guy who may or may not be carrying a gavel, running the auction.

Vendor: The person who currently has the keys to what might be your new place.

 

What those property descriptions actually mean…

Cosy: Perfect first home material. Before the family comes along, grab yourself a cosy starter house and grow from there.

Potential: This home has a tonne of character, and all it needs is a bit of TLC to turn it into property gold. Invest the time and reap the rewards.

Charming: You can’t quite put your finger on it, but you feel an emotional connection to this house and it will sneak into your top choices bracket with ease.

Low maintenance: You can spend less time coming up with excuses as to why the lawn isn’t mowed – you probably won’t have one.

Art Deco or Retro: Shabby chic is all the rage right now and you’ll feel as creative as they come living in this old school gem.

Starter home: Elbow grease and favours from friends is what you’ll need here. A starter is your dream home, and you snagged it for a bargain.

Luxurious: If you’ve worked hard saving, and it’s within your price range, then go for it. You’ve earned it.

 

Loan type lingo

‘Principal and interest’ (P&I) loan: Principal, interest and fees. Your lender has accounted for everything and all you have to do is sit back and make the payments.

Flexible or basic loan: Dramatically cut your interest costs over time by getting on the front foot and paying it off early, or when you feel like it.

Fixed or variable loan: Playing it safe. This one fits like a glove for people who want to keep their interest costs to the very minimum and like the security of knowing their repayment amount.

‘Interest only’ (IO) loan: You’re just paying for the add-ons here. It can be renegotiated every decade or so.

 

Learning a second language is hard work! If you want to put your new found knowledge to usecall one of our Home Loan specialists on 1800 100 258.

 

The information is current as at publication. Any advice on this website does not take into account your objectives, financial situation or needs and you should consider whether it is appropriate for you. Deposit products, savings products, credit card and home loan products are issued by ING, a business name of ING Bank (Australia) Limited ABN 24 000 893 292, AFSL and Australian Credit Licence 229823. ING Living Super (which is part of the ING Superannuation Fund ABN 13 355 603 448) is issued by Diversa Trustees Limited ABN 49 006 421 638, AFSL 235153 RSE L0000635. The insurance cover offered by ING Living Super is provided by Metlife Insurance Limited ABN 75 004 274 882, AFSL 238096. ING Home and Contents Insurance is issued by Auto & General Insurance Company Limited (AGIC) ABN 42 111 586 353 AFSL Licence No 285571 as insurer. It is distributed by Auto & General Services Pty Ltd (AGS) ABN 61 003 617 909 AFSL 241411 and by ING as an Authorised Representative AR 1247634 of AGS. All applications for credit are subject to ING's credit approval criteria, and fees and charges apply. You should consider the relevant Product Disclosure Statement, Terms and Conditions, Fees and Limits Schedule, Financial Services Guide, Key Facts Sheet and Credit Guide available at ing.com.au when deciding whether to acquire, or to continue to hold, a product. Before interacting with us via our social media platforms, please take a minute to familiarise yourself with our Social Media User Terms https://www.ing.com.au/pdf/Social_Media_User_Terms.pdf.

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