Back to Articles

FAQs for lenders

Navigating the world of home loans, refinancing, and business finance can feel overwhelming—especially with so many options, lenders, and requirements to consider. This FAQ guide has been designed to answer some of the most common questions we receive, giving you clear, straightforward insights into the lending process in Australia.

Whether you're a first home buyer, an experienced investor, or a business owner exploring finance options, this guide will help you better understand your choices and what to expect at each stage. If you need more personalised advice, speaking with a qualified mortgage professional can help tailor solutions to your specific financial goals.

1. What does a mortgage broker do in Australia?

A mortgage broker is your financial support person who compares home loan products from multiple lenders for you, to find the most suitable option for your financial situation. Instead of being tied to just one lender, a broker assesses your income, expenses, borrowing capacity and goals, then determines the most suitable and beneficial loan options on your behalf. Brokers can access major banks, non-bank lenders and specialist lenders, helping you secure competitive rates and flexible terms.

2. How much deposit do I need to buy a home in Australia?

Many lenders require a minimum 5% deposit to purchase a home. However, if your deposit is less than 20%, you will generally need to pay an additional Lenders Mortgage Insurance premium (LMI). Having a 20% deposit helps you avoid LMI and may improve your loan options.

Though there are various government schemes that allow eligible first home buyers, or those working in specialised industries to purchase with smaller deposits without incurring LMI.

3. What government schemes are available for first home buyers?

Eligible first home buyers may access schemes such as:

• First home Buyers (stamp) duty exemption
• First Home Owner Grant
• 5% First home Guarantee scheme
• Help to buy scheme

These programs can reduce the upfront deposit required and may even help avoid LMI. Eligibility varies by state and income thresholds, so it is best to speak with your mortgage professional to determine which ones you may be eligible for.

4. How much can I borrow for a home loan?

Your borrowing capacity can vary depending on your financial situation. It is not only about what you earn. The factors involved in determining how much you can borrow can be:

• Your Gross income – PAYG or self employed income
• Existing liabilities – including credit cards and pay as you go facilities
• Ongoing monthly living expenses
• Number of dependants in a household
• Credit history over the past few years

Lenders follow responsible lending guidelines regulated by Australian Securities and Investments Commission (ASIC), meaning they must ensure you can reasonably afford repayments, and never be put in a position of potential financial hardship.

5. When should I refinance my home loan?

You may consider refinancing when:

• Your current fixed rate period ends
• A lower interest rate becomes available
• You want to access equity for future investment
• You wish to consolidate debts
• Your financial situation changes

Refinancing can reduce monthly repayments or even shorten your loan term, but it can come with initial refinance costs. It is always good to compare all potential savings and costs with your mortgage broker before moving forward with a refinance.

6. Can self-employed borrowers get a home loan?

Yes - Self-employed applicants can definitely qualify for a home loan, and these can be in the form of Sole traders, Companies or Trusts. A majority of lenders will require some of the following to verify usable income:

• Two years of completed tax returns
• BAS statements – if applicable.

But there are also particular lenders who offer a Low documentation option if there are not two years worth of tax returns available, or there has been a significant change in recent business income. In these cases, lenders may simply require:

• Accountant declaration of finances
• 2 - 3 x Most recent BAS
• Self declaration of income derived

Lenders assess overall business stability, income consistency and credit history with self employed applicants.

7. What is a commercial property loan?

A commercial property loan finances offices, warehouses, retail spaces or industrial buildings. Unlike residential loans, commercial finance is assessed based on business income, lease agreements and property yield. Lending for commercial properties typically ranges up to 70% - 80% of the property value

8. How does equipment (asset) finance work?

Equipment finance, also known as Asset finance, allows businesses to purchase vehicles, machinery or tools through structured repayments over an agreed term. Options include leasing, hire purchase and chattel mortgage arrangements.

There are particular lenders who deal specifically with Asset finance, and it is worth deciphering which one of these would fit the most compatibly with what you would like to achieve.

9. What is a chattel mortgage?

A chattel mortgage is a business loan where the borrower owns the asset from day one, while the lender takes security over it. This structure may provide GST and depreciation benefits for eligible businesses.

A chattel mortgage is most commonly used for car finance and similar types of assets.

10. Do you compare multiple lenders across Australia?

Yes. We compare major banks, regional lenders and specialist funders across Australia to find competitive rates and flexible lending solutions tailored to your financial position. We have access to over 40 types of lenders so that we can find the ones that are the most suitable for what you would like to achieve.