Frequently Asked Questions

Why use a broker?

Finding the right loan starts with choosing the right broker!

Will your bank let you know that there is a better offer or product with the bank across the street? Do you really want to run around to different banks in order to source the best deal?

A good broker will help you navigate the sometimes daunting world of home loans to secure the most suitable home loan for you and your unique situation. Mortgage brokers have access to an array of lenders who offer varying products and are also able to secure discount rates and special deals with particular lenders. They do the shopping for you, they handle the paperwork for you and essentially take the stress and fuss out of finding a loan. Brokers with experience are often great sources of advice and have expert knowledge on a broader financial issues and are able to guide you and structure loans to meet your big-picture financial goals as well. So why not use a broker?

Why choose hatch?

With over 13 years of experience in the industry, our success starts and ends with you, the client.  Hatch Financial services was founded and built upon the values of genuine service, assistance and tailored advice for clients financial situations and personal needs.  At Hatch we help to simplify this process. We explain everything you need to know in language you can understand. We help you find a loan that is right for you and then we take care of the application process. From thinking about purchasing a property, all the way through to settlement, we’ll guide you along the way and take away all the hard work, unnecessary stress and paperwork of getting a loan.

We also have the numbers to prove it!
– We settled over 1000 loans and over $330M in loan value.
– 95% of our business is from referrals and word of mouth from out satisfied clients.
– over 40% of our business is from return clients.

So dont ask us, see our testimonials!

A mortgage is one of the greatest debts and financial decisions a person will make in their lifetime. We get a kick out of helping our clients achieve their financial goals, whether its to finally own their first home, to upsize and accommodate for the growing family, or to purchase a holiday home or investment property. And once you’ve settled, we don’t just leave you hanging, we check in once a year to make sure your loan still suits your needs and to inform you about the latest offers!

What is your fee?

Free. $0. Nada!

Our service to you is free of charge. We do all the hard work for you in finding the best loan to accommodate your situation and needs.We get paid by the lender that gets the loan and it does not cost you (via higher rates or fees) in any way . See our credit guide for more info.

How do you decide which loan is best suited to my personal situation?

We ask you lots of questions to understand what you need and want, then we find the lenders and products that tick the boxes. We present you with a short list of options and help you to make the final decision.

Do you offer a range of different lenders?

Hatch has access to over 25 lenders. We know the latest offers of all our lenders and how much they would be willing to lend you. We’ll advise you on the top lenders for you position and assist you in structuring the ideal loan for your needs.

What is the lowest interest rate at present?

Finding the lowest interest rate on the market might not necessarily provide you with the best loan deal, structure and long-term savings. There are many other factors that need to be considered when choosing the right loan including; annual fees, offset accounts, repayment flexibility, features and conditions of the package. That being said, the market is extremely competitive and many banks offer discounted interest rates which may not be advertised to the general public. So it’s worth giving us a call, just to compare with  what your bank might be offering you.

What is a pre-approval? Do I need a one?

A pre-approval is not an essential step in the purchase of a property however it’s a very helpful one! Many people come to us once they’ve already bought, seeking financing for their property (which is fine). However, a pre-approval can provide you with the comfort and knowledge before you purchase, about your borrowing capacity, and the maximum amount you can afford to repay based on your income levels and a number of other factors. It’s assurance from the bank which can take away stress if you’re worried about funding! Once confirmed, your pre-approval lasts up to 3 months. Click here for more info.

What is the loan process?

The loan process has many components and can look overwhelming to the average person. However there is nothing to fear because we take the hassle out of home loans by dealing with all the paperwork and guiding you through every step from the very beginning until settlement. We’re a constant source of communication and advice and genuinely care about you and your financial situation.

There are 3 main steps:
1) Meeting with you, discussing your plans and goals and finance options
2) Decision Making, gathering of documents and submission of loan application
3) Approval from Lender and Settlement

How long will it take for you to get finance approved?

The time it takes for a loan application to get approved varies greatly depending on the lender, scenario and sometimes the urgency to obtain finance. Often the lengthiest part of the process is our clients gathering all the appropriate documents and sending them to us.  Once we send an application through to the bank it takes on average 2-7 days to get formal approval from the bank.  With some lenders we also get priority in the queue due to our relationship with the banks.

However as a general rule, its best to be well prepared, especially when it comes to buying new property as there are a number decisions that need to be made when applying for finance – not just the lender, product and loan amount. Have a chat to us about timing if you’re unsure or have a read of our other FAQS “The Loan Process” and “Pre-approval.”

What documents do you need from me?

In most cases, these are the documents we require from you:

  • 2 most recent payslips & PAYG Payment Summary (Group certificate)
  • Self-employed? Tax returns for last two financial years & Tax Assessment notice.
  • Most recent statement for all credit cards and other debts (inc HELP debts & Car loans)
  • Evidence of savings
  • Most recent statement for your transaction account
  • Copies of Drivers Licence and Passport

Your personal information is always held in the strictest of confidence. Feel free to view our privacy policy here.

How much can I borrow?

The amount you can borrow is primarily dependent upon your income and existing debts (including loans and credit cards). A number of other factors including assets and equity in those assets can also assist in increasing your borrowing power. Each Lender has its own way of calculating and assessing your borrowing power which as a result can impact the bank you decide to choose. It is also important to note that there is a difference between what a bank is willing to lend you and what you can afford in terms of a loan. The best way to calculate what size loan you can afford is by creating a detailed budget and making sure you have sufficient funds to cover the loan at both current rates and if rates go up 3%. But not everyone works with budgets so there are other ways to work this out. To get a rough idea of what you can afford we have some useful calculators online or check out our video on working out “how much you can borrow”. Even better give us a  call and let us help you.

How can I increase what a bank will lend me?

To increase your borrowing capacity there are a few “levers” you can pull. The most obvious is to increase your income. But this is often easier said than done. The second is to reduce your commitments. The easiest of which is to reduce (or cancel) credit card limits. You should also look at getting rid of personal loans or car loans or HELP debts if you need to increase your borrowing power.  But before you use your savings to pay off debts we suggest you talk to us as savings may be more important than paying down debts. As always, this needs to be considered on a case by case basis.

What will my repayments be?

Loan repayments are paid either fortnightly or monthly and will vary depending on whether you have variable or fixed interest rates and also whether you are repaying principal and interest or interest only. For a more accurate prediction of how much YOUR repayments will be on your loan amount check out our calculators.

What are the extra costs associated with buying property?

The main costs to take into account when buying property are:

Purchase Price:
This is kind of obvious and rarely overlooked!

Government Costs:

– Stamp Duty + Government charges
These costs vary from state to state. In Victoria stamp duty and government fees is around 5.5% of the purchase price of the property. For example on a $600,000 home, stamp duty and fees will amount to approx. $32,500. Some first home buyer are eligible for government grants and discount on stamp duty.   See our calculators to work out fees associated with purchasing property in your price range.

Loan Costs:
–  Lender’s Mortgage Insurance (LMI)
If you’re borrowing more than 80% of the property value (ie more than $480,000 on a $600,000 property) you will be required to pay lender’s mortgage insurance which is a one-off fee cost. The cost of LMI increases as the loan amount increases and the loan:value ratio increases. The cost can be anything from a $1,000 to $30,000. See this video for more info.

– Loan Establishment Fees
Some lenders charge a one-off fee to set up the loan account. Often this is waived as the lending market is quite competitive. If not the average establishment costs are $200-$600.

Your Costs:
– Conveyancer/Lawyer
Legal fees for purchasing property amount to approx $800-$1500 but could be a lot more if purchasing property in the name of a business of company. Conveyancer deal title searches, transfer of titles and the execution of finances at settlement. Let us know if you’d like us to put you on to a good conveyancer or lawyer.

– Building/Pest Inspection
It is recommended to get a building and/or pest inspection on your purchase to ensure there is no structural issues or damage to the property. This typically costs $300-400. Ask us if you need help finding a professional to do this for you

It’s best to budget an extra 6-7% of the purchase price to cover stamp duty, conveyancing and other expenses.

Other costs to consider:

– One off costs -Moving Costs
– Ongoing costs – Rates/Body Corporate Fees, utilities
– Home & Contents Insurance (or Landlord insurance for investment properties)

And of course the loan itself! See our calculators for how much repayments will be. And check out our video on the cost of buying property.

Does it matter what my credit card limits are? Should I cancel my credit cards?

The first thing to note is that credit card limits matter with most but not all lenders. There are a few lenders that will not factor in credit card limits into calculations where the cards are shown to be paid off in full each month over a 3 month period.

When banks look at how much they will lend you, they consider your income and your commitments. So it goes with out saying that they look at the wages you earn and the debts you have (car loan, HELP debt, living costs etc). They also look at your credit card limits. But why do they do this if you pay off your credit card each month? Well the answer is because the banks are factoring into their calculations the possibility that you might start to use your credit card more and carry debt on the card beyond the end of the month and start to need to make interest repayments on this debt…which reduces the amount of money you have available to meet home loan repayments.

Does this mean you should cancel your credit cards before applying for a loan? Not necessarily. Whether you need to do this will depend on the overall strength of your position and your mortgage broker can advise you about this as part of arranging finance for you.

We find many clients are very worried about the impact of their credit card limits on their chances of getting a home loan approved when in fact in the majority of cases this is of little or no concern.

What is an offset account?

An offset account is a transaction account (non-interest earning) that is linked to a home loan account. The balance in this account is ‘offset’ daily against the outstanding loan balance thereby reducing interest payable on that loan. For example a $400,000 loan with $50,000 in offset means the interest expense is charged on $350,000. It is a great way to save money on your loan and is often the better than most saving accounts interest you would be earning. Watch this video for more info on offset accounts.

How do I pay the deposit if I am successful at auction?

The most common way to pay a deposit once you are successful at auction is generally by means of bank cheque and is often 10% of the purchase price. That being said, the amount paid could be negotiated or different depending on the seller/vendor, and furthermore it is becoming more common to pay deposits by electronic transfer. Be sure to ask the agents, and make sure your daily limit is high enough to process the transfer!

Do I need the help of other professionals to purchase property?

There are certain people and services that are essential in the process of buying property, others which are highly recommended, and some which are optional but very useful.
If your loan involves the purchase or sale of property, the service of a conveyancer/lawyer is essential for arranging settlement, transfers of titles and completion of funds. Furthermore, its crucial to arrange home and contents and/or landlord insurance for your new property.
On top of this, you can also engage the services of the following:
– Buyer’s Advocates/Property Advisers
– Building/Pest Inspector
– Property Manager
Feel free to refer to our numerous business partners to assist you or give us a call on 1300 442 824 if you’d like to know more information.
You can also check out our article “Purchasing Property: It’s All About Teamwork.”

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