All Finance Australia Glossary of Finance Terms
Bad Credit Mortgage
Bad credit mortgages allows you to purchase your home or property although you have encountered a bad credit rating. There may be many reasons where people fall into bad credit but it does not necessarily mean you are a risk to lenders. Bad credit mortgages can work to your advantage and help you turn your bad credit rating around so long as you make monthly payments and show reliablilty.
Bridging Loan
Bridging loans are the ideal way to finance the gaps when your new purchasing of property or business doesn't settle in the timeframe that is required. It's a great way of solving a temporary cash shortfall. You can secure a bridging loan by getting a mortgage on the new property, and taking out a second mortgage on the property being sold. A tip with bridging finance is to do your homework first and get your finances pre-approved before you go shopping. That way the seller knows you are serious.
Chatell Mortgage
Chattel Mortgage provides ownership of the goods and remains yours with repayments structured to suit your cash flow and full tax benefits going to you.
Commercial Hire Purchase (CHP)
Commercial Hire Purchase provides you with immediate use of goods in exchange for regular payments, with ownership of goods being transferred to you when the final repayment is made.
Commercial Property Loan
Commercial Property Loans can be financing of retail, office, industrial estates, shopping centres, large item goods, hotels, commercial developments and large scale residential. Some of the benefits to you are:
- Experienced commercial property specialist
- Access to lenders in one simple step
- Simple application process
- High LVR commercial loans
- Full Doc, Lo Doc and No Doc
Construction Home Loan
Construction home loan allows you to build the home of your choice, either on your land or house and land package.
Pre-approval for construction normally gives you 12 months to complete your designs and arrange a fixed price contract with your builder to complete your new home.
Equity Home Loan
Equity home loan is a way of turning the increased value of your property into funds that can be used for any purpose such as renovations, purchasing investments and starting a business. Your Equity loan can be an open line of credit that you use as you need it.
First Home Buyers
To assist the first home buyer to build and buy their first home, the Federal Government offer a one-off grant to those who are eligible. There are a range of State Government concessions available as well, all designed to help 'first home buyers'.
Tips to look out for:
- Some lenders allow you to borrow more than others
- How much can you borrow
- Arrange a pre-approval before you go house hunting which will reassure real estate agents that you are serious.
Fixed Rate Loans
Fixed rate home loans offer a fixed interest rate over a specific term of the loan, usually between one and five years but can be as long as ten years. At the end of this period you can negotiate a new term or switch to variable rate loan.
By having the interest rate fixed, you can budget with confidence knowing that if interest rates go up, your repayments will remain the same for the fixed term. However, fixed rate loans have limited features such as no additional payments and most have very high penatlies for early payout or changes.
Home Loan
Owning your own home is every Australian's dream - make that dream a reality - Enjoy the experience with someone who understands what it means - who understands what a "fair deal" "fair go" really is. From First Home owners to families building a bigger home to accomodate a new addition to purchasing that investment property. All Finance Australia offer an independent service offering a range of loans from different lenders, including the banks. You choose the best loan for you.
Home Equity Loan
Home Equity Loan is a type of loan which the borrower uses the equity in their home as collateral and is useful when you need to renovate or have an excessive bill period. Most home equity loans require good to excellent credit history, and reasonable loan-to-value and combined loan-to-value ratios.
Introductory Loans
Introductory Loans are popular with first home buyers and typically offer slightly lower interest rates and lower fees, during the introductory period. In return for lower rate and fees, these home loans have fewer features, such as no additional repayments, and can be less flexible and may convert to standard home loans later.
Investment Home Loan
A common misconception people have is that you need to have cash to purchase an investment property. An Investment Home Loan is where you have no savings but you own your own home or other property with significant equity in it. Whether you are a first time investor or seasoned professional, chances are you will need to move quickly to secure the opportunity when it comes along. You can have a choice of Investment home loans to suit, pre-approval, interest only, low rate, fiixed rate and more.
Line of Credit Facility
Line of Credit Facility allows you to turn the increased value in your home into investment capital which allows you to generate investment income or pay off or consolidate higher cost debts.
Lo Doc Equipment Loan
Lo Doc Equipment Loan provides leasing of specific vehicles and equipment without the need for full financial statements. There is an easy process with quick approvals and having a financial assessment based on property equity and business stability.
Lo Doc Home Loan
Lo Doc Home Loans are loans tailored to suit borrowers who are self-employed for a period of time without the hassle of providing mountains of paper work to prove their income. These loans can be used for almost any purpose such as purchasing a new home, refinancing or releasing equity in your current home. Limits apply to how much can be borrowed.
No Doc Home Loan
No Doc Home Loans are tailored to suit self-employed customers who require a loan for investment purposes with no evidence of income required. No hassle loan. Limits apply to how much can be borrowed.
New Business Capital
New Business Capital can be used to start a franchise, purchase an existing business or expand your own expertise and work for yourself. Selecting the right type of finance package for your business can mean the difference between success and failure.
Packages include:
- Term business loans
- Equipment Leasing and Rental
- Line of Credit Facility
- Equity Loans
Offset Account Loans
Mortgage Offset Account is simply a savings account that is linked to your home loan account. The balance of the savings account is offset against the amount owing on the mortgage and over time, savings in your offset account can help reduce the loan, allowing you to pay off your home loan sooner.
Refinance Home Loan
Refinancing Home Loan is simply taking out a new mortgage to replace your current mortgage.
Circumstances change, so its a good idea to review your home loan and compare it with what else is on the market.
Some reasons for refinance are lower rate, monthly fees, having children, changing jobs, buying investments and more.
Rental
Rental provides the flexibility to enhance, upgrade or add equipment during the agreement term. This is ideal for goods that require regular upgrades. At the end of the agreement term, the goods can be returned or you can continue to rent.
Rural Property Loan
First registered mortgage loans are available on property that is zoned rural and can be residential or income producing. All Finance have solutions available for borrowers who either choose not to deal with traditional lenders or do not conform to the lending criteria. These are perfect for self certifed, credit impaired, non-conforming customers who require competetive rates and higher loan amounts.
Sale and Lease Back
Sale and Lease Back or Hire Back agreements involves the finance provider buying your business asset for an agreed value and leasing or hiring the asset to you for an agreed term. This type of arrangement can release equity you have in your current assets to be used to purchase additional items, provide working capital or increase cash flow.
Second Mortgage - 2nd Mortgage
Second Mortgage normally refers to a secured loan or mortgage that is secondary to another loan against the same property. In finance terms a second mortgage generally takes the form of a home equity loan and the two are identical. A mortgage mainly refers to the legal lien instrument, rather than the debt itself.
Short Term Finance
Short Term Finance is available normally for terms of 3 - 12 months and are secured against real estate.
These loans can be approved and funded in 24 hours and can be used for working capital, business investment, refinancing of existing debts or funding of other statutory payments.
Small Business Finance
Small Business Finance is ideal for self employed and business owners who want to finance, fund or expand a worthwhile business idea. You can arrange funds for initial expenses, purchase of equipment or development of your current operation.
Some of the benefits of small business loans include:
- Any business purpose
- Better manage cash flow with flexible repayment options
- Strong working capital position
- Tax advantages (consult your accountant)
- Lower rates and fees
- Flexible terms to suit your business
Term Loan
Term Loans are business loans arranged for specific terms to support business contracts
Variable Home Loans
Standard Variable Rate Home Loan is one of the most popular home loan types because it offers a full range of features, flexibilty, rates and fees. These benefits include:
- Ability to make additional repayments
- Redraw facility
- Split loan features
- Salary credit / line of credit facility
- Portability
- Repayment flexiblity
In return for these benefits, a standard variable rate home loan will have a higher interest rate than special condition home loans such as introductory rate home loans.
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