Home Loans - Frequently Asked Questions

Who can borrow money?
Anyone over 18 who can meet repayments can apply for a Prosperity Mutual home loan. You don't have to be an existing customer. We look for someone who is receiving a regular income and we need to know what your current debts and expenses are.

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How much deposit do I need?
The deposit required will depend on the type of transaction and loan facility you choose. If you are looking at investing or purchasing your own property you can borrow up to 90% of the purchase price or valuation (whichever is the lesser). If you are looking at purchasing vacant land you can borrow up to 85% of the purchase price or valuation (whichever is the lesser).

You can borrow up to 95% of the purchase price for most of our home loans except for Asset line products, where you can borrow up to 90% of the purchase price or valuation (whichever is the lesser).

For Home Loans and Asset Lines, Lenders Mortgage Insurance may be payable if the loan is more than 80% of the value of the property. This percentage may vary depending on the type of home loan. Where Lenders Mortgage Insurance is payable for Asset Lines, terms and conditions apply.

Our Prosperity Mutual Deposit KickStart option enables you to use the equity in the home of a family member or friend towards the purchase of your new owner occupied home so you do not have to pay for Lenders Mortgage Insurance. You may borrow up to 110% of the purchase price or valuation of your new owner occupied home (whichever is the lesser). Terms and conditions apply.

First Home Owners may also qualify for the First Home Owners Grant, which can be used towards Government, legal and bank fees. We can process the First Home Owners Grant application with the Prosperity Mutual Home Loan.

If you intend on borrowing for investment purposes you need to demonstrate 20% equity in your existing property or deposit.

If you already own a property, you can use equity in that property as a deposit to purchase another property. Prosperity Mutual may hold security over both properties while the loan is being repaid.

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For what purposes can I borrow money?
We will lend you money:
to buy a residential property
to buy a residential investment property
to refinance an existing mortgage
to refinance an existing mortgage and consolidate your other debts
for investment purposes (other than property) where you provide enough equity in property as security
for a second mortgage over current property where extra money is needed to buy a residential investment property (In this case, Prosperity Mutual will hold a first mortgage over the new property.)

For any home loan, residential property must be offered as security.

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Will the bank require a property valuation?
In most instances, a valuation will be required. We will advise you at the time of application if a valuation is required.

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How much can I borrow?
The minimum amount we would lend for a home loan is $10,000. The maximum loan amount depends on your borrowing capacity. Our loan calculators can give you an idea of how much your monthly repayments would be and how long you could take to repay the debt.

Once you submit your full application, we will assess your financial position and confirm the loan amount and term you have requested.

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What if I'm self-employed?
We have home loans available for customers that are self-employed. Our Low-Doc Loan products are specifically designed to meet the needs of customers that are self-employed. Find out more about our Low Doc Loans.

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What about the First Home Owners Grant?
The Government's First Home Owners Scheme has been introduced to offset the impact of GST and assist first home buyers.

Prosperity Mutual can make it easy for you to apply for your $21,000 Grant. We can also arrange prompt payment, and show you how to best use the money.

Find out more about the First Home Owners Grant, and how you may use it to reduce the cost of buying your home.

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What sort of Fees or Charges will apply to my home loan?
Various bank fees and charges may apply for each of our home loans. The product information pages for each of our loan products includes fees information.

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What is the difference between fixed and variable rates?
A fixed interest rate does not vary for the fixed rate period, so payments remain constant for this period.

A variable interest rate may vary according to market conditions, and may increase or decrease at any time. Your loan payments will change accordingly to reflect this change in interest rate.

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What is pre-approval and how do I get it?
Pre-approval is a conditional approval based on your ability to repay a loan. This means that you can search for a home, knowing how much the bank can lend you.

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How can I make repayments on my loan?
There are several ways to do this and you can choose the method most convenient for you. You can:

-arrange an automatic regular repayment from a nominated account - weekly, fortnightly or monthly depending on which loan you have chosen
- transfer money from any other Prosperity Mutual transaction or savings account through phone or internet
- make a repayment at any Prosperity Mutual branch.

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When do my payments start?
Generally your repayments will begin one month from the date of settlement of your loan. For example, if your loan settled on the 2nd March, your first repayment would be due on the 2nd April.

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How early can I repay my loan?
You can pay out your loan as quickly as you like. If it is repaid within the first 4 years, a Deferred Establishment Fee will apply. There is also a fee for finalising your home loan (currently $250).

If you have a Fixed Rate home loan and want to break the term, an Early Repayment Adjustment Fee may also apply.

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Can I access advance payments?
Yes. Our Cashback facility lets you withdraw funds from your home loan that are above your normal repayments. Making these additional payments means you are paying off your home loan as soon as possible, but you can draw this excess money at any time, for example: school and university expenses, a holiday, renovations etc.

This feature is available on Prosperity Mutual home loans (except for Fixed Rate Loans). The minimum withdrawal is $1,000 and you must leave at least one month's repayment in your loan account.

If you want Cashback from an existing Prosperity Mutual home loan, complete and print the applicable cashback request form and take to your nearest branch, or mail it to us.

You need to apply for cashback, which is available subject to conditions.

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Can I pay extra each month?
You can pay extra in addition to your regular monthly repayment on our Variable Rate home loans at any time.

With our Fixed Rate home loans, additional repayments may incur an Early Payment Interest Adjustment Fee.

Our Back to Basics Home Loan also allows extra regular repayments, but they must be made using our automatic transfer facility.

Note: a Deferred Establishment Fee is payable if the loan is paid out within 4 years.

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Can I attach a Home Loan Offset Account to my loan?
Yes. The Standard Variable Rate Home Loan comes with the option of a 100% home loan offset attached to an Everyday Options savings account. This account can allow you to use your income and savings to reduce your loan interest.

Note: A Mortgage Offset Fee applies to set up the 100% Home Loan Offset Facility charged to the Loan Account to be linked.

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Can I pay-out my home loan at any time?
You can pay out your loan as quickly as you like. If it is repaid within the first 4 years, a Deferred Establishment Fee will apply. There is also a fee for finalising your home loan.

If you have a Fixed Rate home loan and want to break the term, an Early Repayment Adjustment Fee may also apply.

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What is direct salary crediting and how do I establish it?
You can have your salary directly credited into your loan account on a weekly, fortnightly or monthly basis. This will need to be established through your employer. Use a loan cashback to access this money as required.

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LOOKING FOR A BETTER DEAL ?

Wether you are buying your first home, refinancing or want to save money through mortgage reduction
Prosperity Mutual can help you save money on your home loan & guide you from our initial consultation all the way through to settlement. Providing you with a personal service second to none.

CONTACT US TODAY ON 1300 854 667