Buying a home is one of the most exciting experiences we face. If you're new to the property market, or just out of practice, it's only natural that you'll have some questions from time to time.
What does ‘LVR’ mean? Can you make extra home loan repayments?
We answer these and a range of questions about your home loan journey, from applying all the way through to paying off your loan.
Check out our range of home loans and our current interest rates
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
A home loan (or mortgage) is money you borrow from a lender to buy a property.
You can use it to buy an existing home, purchase off the plan, or buy land to build on.
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
The amount you borrow is called the principal, and it’s what you repay over the life of your loan.
Your interest rate is the cost of borrowing that money. It’s a percentage rate charged by the lender, and it’s added to your loan.
Over time, you repay both the amount you borrowed and the interest. Home Loan interest rates can be fixed, variable, or a mix of both.
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
A comparison rate shows the true cost of a home loan.
It includes the interest rate plus upfront and ongoing fees, based on a standard example (usually a $150,000 principal and interest loan over 25 years), so you can more easily compare loans.
Conditional approval means your loan has been approved, subject to final checks.
These checks can include the property valuation, confirming your income, and verifying your documents and identity.
Terms, conditions, fees, charges and credit criteria apply.
The start date is when we fund your home loan.
From this date, your interest starts accruing and your repayments begin.
Work out how much you still owe on your home loan, then compare it to your property’s value.
The difference is your equity, which is the part of the home you own.
Lenders Mortgage Insurance (LMI) protects the lender, not you.
It may apply if your deposit is less than 20%. It’s usually a one‑off cost, which can often be added to your loan.
If you can’t make your repayments and the property is sold for less than the loan amount, LMI helps cover any shortfall.
LVR (loan to value ratio) is the size of your loan compared to the value of the property.
Lenders use this to assess your application and to decide if you need to pay Lenders Mortgage Insurance (LMI).
For example:
|
Amount you intend to borrow: |
Value of purchase property: |
Therefore what the LVR is: |
|
$400,000 |
$500,000 |
80% |
A variable interest rate can go up or down over time depending on market conditions, so the rate you have today may be different in 6 or 12 months.
A fixed interest rate stays the same for a set period, giving you certainty over your repayments. However, if interest rates drop, your rate and repayments won’t change during that time.
Check out Greater Bank’s full range of current fixed and variable home loan interest rates below.
Compare current Home Loan interest rates
Compare current Home Loan interest rates
Terms, conditions, fees, charges and credit criteria apply.
There’s no one option that’s right for everyone. You should choose a loan based on your needs.
A variable rate loan means your interest rate can go up or down. This gives you more flexibility, like making extra repayments.
A fixed rate loan means your interest rate is locked in for a set period, so your repayments stay the same for the fixed term, making it easier for you to budget.
Terms, conditions, fees, charges and credit criteria apply.
Use one of our lending calculators to find out:
A packaged variable rate loan lets you bundle your home loan with other products, like an everyday account, offset account or credit card.
You pay one annual fee for the package, and in return you may get benefits like a lower interest rate, a 100% offset account, and discounts on other products.
It’s important to consider if the benefits are worth the fee for your situation.
Terms, conditions, fees, charges and credit criteria apply.
Yes.
We know sometimes it's hard for you to visit us when applying for a home loan, so we will come to you. Our experienced lenders can visit you at home or work, at a time that suits you.
Find your local lender in branch
Terms, conditions, fees, charges and credit criteria apply.
For some products and services, Greater Bank will require verification of identification.
In these instances, we may ask you to provide us with certified copies of identification.
If this is the case, the following requirements must be satisfied:
The person certifying the document cannot be you or a related party to you.
Certified copies of previously certified copies will not be accepted. A properly certified copy of the original document must be provided.
The person certifying the document must have sighted the original document/s
To certify a document, the authorised certifier is required to write or stamp on the document:
‘This is a certified true copy of the original as sighted by me'
On the first page: 'I certify this and the following [number of pages] pages to be a true copy of the original as sighted by me' and initial all other pages.
The certifier must also write or stamp on the copy:
The date; and
The signature of the person certifying the document; and
The full name, occupation and contact number of the person certifying the document (this should be clearly printed or evident in any official stamp that is used); and
Where relevant, the registration number of the person certifying the document (for example a Justice of the Peace must include their registration number when certifying a document); and
Their address (optional).
NOTE: a certified copy is not a photocopy of a previously certified document. The original document must be sighted and certified as a true copy of the original.
You can download our Certification of Documents - Customer Guide here.
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
You’ll find the list of people who can certify a document for you (like a copy of your ID), and the legal requirements for this on the Federal Register of Legislation.
Check this register to make sure the occupation of the person who is to certify your document meets certification requirements. If any of these requirements are not met, the certified copy CANNOT be accepted.
There are several options for setting up your home loan repayments, depending on your financial goals and circumstances. You can also choose to repay your loan weekly, fortnightly or monthly to suit your budget.
Monthly repayment only: You can easily set up an Easypay repayment for all Greater Bank home loans via online banking. The 'monthly repayment only' option will automatically increase or decrease in line with interest rate movements. You can also opt to make your monthly repayment weekly or fortnightly. You can also choose to add an additional amount your monthly repayment if you would like to pay more each month.
Fixed amount: This option is available if you opt to nominate a fixed amount. Changes to the amount will need to be managed by you via online banking in line with interest rate movements as the repayment amount will not change automatically.
If you have automatic transfers set up from another financial institution, you’ll need to contact them to update your repayment amount or check your current transfer amount.
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
You can set up an automatic home loan repayments in online banking or our mobile app.
Log in and go to 'Transfer' > select the account you’d like to pay your loan from > then select your loan
In the ‘Type’ field, you can select from the drop-down menu the transfer type.
Monthly Repayment Only – this is the monthly repayment on your loan calculated at the time of payment
Monthly Repayment Plus Extra – Pay a fixed amount off your loan, in addition to the monthly repayment on your loan, calculated at the time of payment.
If you want to set up a recurring payment, select ‘Recurring’
Then select the frequency – Weekly, Fortnightly, Monthly
Select a start date by tapping into the date field, and a calendar will appear.
Select when you would like this to end – either ‘Never’ or ‘On a specific date’
Click ‘Next’
The click ‘Confirm and transfer’
If you have a scheduled Fixed Home Loan or Personal Loan repayment that you’d like to change, you can edit this by going to ‘Scheduled’ located in the side menu if accessing Online Banking on a desktop, or going to ‘Manage' > 'Scheduled’ if using the app.
Select the scheduled payment for your loan
Select ‘Edit’ and make your changes
If you wish to delete the payment select ‘Delete’
If you have a Monthly Repayment Only or Monthly Repayment Plus Extra and wish to change this, you will need to delete these, as these payment types can’t be edited.
Pay extra on my fixed rate home loan without a penalty?
You can make additional payments during a fixed period on Principal and Interest and Interest Only loans but a pre-payment fee may apply.
You can make extra repayments up to 5% of your original loan amount before there is any chance that a prepayment fee may apply.
Pre-payment fees don’t apply to an extra repayment on a variable rate home loan.
On a fixed rate loan, you can usually make extra repayments‡, but limits apply.
For example, at Greater Bank you can typically repay up to 5% of your original loan amount. Going over this may result in a fee.
For example:
If your original loan was $150,000, 5% is $7,500
If you repay $6,500, no fee would apply
If you repay $9,000, a fee may apply on the amount over $7,500.
There’s no limit on extra repayments for variable rate loans.
‡A prepayment fee applies to fixed rate loans if you make more than 5% in extra payments. Contact us before making additional repayments to get an estimate of the prepayment fee.
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
To calculate a pre-payment fee we take the extra payment over and above the 5% of the original loan amount and times it by the remaining fixed period and then times it by the interest differential.
Let’s look at an example:
For a $1,500 loan pre-payment, with a remaining fixed period of 2 years and an interest differential of 0.25%, the calculation is:
$1,500 X 2 X 0.25% = $7.50
Or, $1,500 times 2 times 0.25% equals a $7.50 pre-payment fee in this example.
Congratulations on paying off your loan!
If you have a variable rate loan, you can usually pay it out at any time.
If you have a fixed rate loan, paying it out early or making changes may mean a break fee applies.
You’ll also need to pay discharge and registration fees when your loan is closed.
WARNING
Break Costs can be quite high. We suggest you ask us for an estimate of the Break Cost and seek independent financial advice before you do any of these things while you are under the fixed rate option.
A fixed rate option may not be suitable for you if you plan on breaking the fixed rate period
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
A break cost fee may be payable if the loan is repaid before the end of the fixed rate period, or if you switch to another loan type during the fixed rate period e.g. from a fixed rate to a variable rate.
The break cost fee is an estimate of the interest we should have received for the rest of the fixed rate period compared to the interest we would receive if we relend those funds.
We compare the interest rate you locked into the equivalent current interest rate based on the time remaining on your fixed rate period.
If fixed interest rates have increased since you locked in your fixed rate, it’s quite possible that you won’t be charged a break cost fee.
We only charge a break cost fee if we will incur a loss as a result of you breaking your fixed rate loan.
A simple version of the break cost formula is:
Break cost = Loan Balance Owing x Interest Differential x Remaining Fixed Period
Here are some example break cost calculations:
| Example 1 | Loan balance of $300,000 with a fixed rate of 5.00% p.a. for 5 years, which is repaid after 2 years. The time remaining for the fixed rate term locked in is 3 years and the current 3 year fixed rate is 4.00% p.a.
|
| Example 2 | Loan balance of $300,000 with a fixed rate of 4.80% p.a. for 5 years, which is repaid after 2 years. The time remaining for the fixed rate term locked in is 3 years. The fixed rate of 4.80% p.a. is the discounted interest rate (fixed rate less a discount of 0.20% p.a.). The current 3 year fixed rate is 4.00% p.a. and the equivalent current rate after allowing for a discount of 0.20% p.a. is 3.80% p.a.
|
| Example 3 | Loan balance of $300,000 with a fixed rate of 4.00% p.a. for 5 years, which is repaid after 2 years. The time remaining for the fixed rate term locked in is 3 years and the current 3 year fixed rate is 5.00% p.a.
|
Terms, conditions, fees, charges and credit criteria apply. This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
WARNING
Break Costs can be quite high. We suggest you ask us for an estimate of the Break Cost and seek independent financial advice before you do any of these things while you are under the fixed rate option.
A fixed rate option may not be suitable for you if you plan on breaking the fixed rate period
Changing from one Greater Bank Home Loan Product to another is easier than you might think.
Get in touch with us today to see what our lending staff can do to make life greater?
Note: Fixed Rate break costs and Conversion fees may apply.
Terms, conditions, fees, charges and credit criteria apply.
WARNING
Break Costs can be quite high. We suggest you ask us for an estimate of the Break Cost and seek independent financial advice before you do any of these things while you are under the fixed rate option.
A fixed rate option may not be suitable for you if you plan on breaking the fixed rate period
