Interest is calculated on the daily balance of your loan. If you are paying principle and interest, your loan balance will reduce and the interest charged for the month ahead will be calculated on that reduced balance. Payments due each month may vary, and this can be primarily attributed to the number of days in each month and the daily balances. Interest payments are charged in arrears.
Why would I take out an interest only loan?
Usually investors choose interest only repayments to maximise the benefits of negative gearing; that is tax benefits. With interest only repayments you do not pay off the principle (i.e. original amount) borrowed.
What is the difference between self-certifying and fully verified loans?
Self certified loans are those where the borrowers confirm their income on a declaration; no other supporting income or financial statements are required. Interest on these loans will be charged at a higher rate.
Fully verified loans are those where the borrower proves their income by providing evidence such as group certificates, pay slips, tax returns etc.
Why do I need to show genuine savings?
What is genuine savings?
Genuine savings is money that you have saved in your own name. Savings can be in the form of bank savings; a share etc and is usually over a 6 month period.
Genuine savings are used to demonstrate the borrowers' ability to maintain a savings pattern, similar to maintaining a loan repayment pattern. Secondly, it proves that the borrowers have adequate money to complete the purchase after the loan is applied.
Once I submit an application what happens next?
The application is assessed, whereby a credit check, employment checks (if fully verified), valuations and mortgage insurance is undertaken. Once all of the above and .lending criteria have been met, the loan is then approved.
You will be notified in writing of the approval, should formal approval not be available a request for more information may be necessary.
Soon after approval, you will receive loan contracts from Platinum's solicitors, you are required to sign and return these, in order for settlement to take place. It is recommended that you have your solicitor or conveyancer check the documents on your behalf.
Once our solicitor receives the signed contracts, your loan is booked in for settlement. At settlement, money exchanges between the parties and your new loan is activated.
From this date onwards your obligations under the loan contract commence and you are required to make payments as required.
What is a Deposit Bond?
Deposit Bonds are used when you do not have ready cash to pay the deposit on a property. Deposit Bonds are cost effective and very simple to use.
Platinum acts as an agent for suppliers of deposit bonds and we can issue them upon confirmation of loan approval. At the time of settlement funds from your loan will be used to 'cash in' the bonds. If the settlement does not proceed the vendor is entitled to redeem the bond for cash within approx 48 hours. As the purchaser you are obligated to pay this money.
What is Mortgage Insurance?
Mortgage Insurance is usually required when the loan is greater than 80% of the property's value (or as required by the lender) and is a one off payment.
Mortgage Insurance covers Platinum in the event you default on the loan and the money from the sale of the property is less than the amount owed on the loan.
This shortfall is paid by the mortgage insurer, who in turn will look to you for repayment of these funds.
Can I switch my loan between products and features?
Yes, you have the ability in most circumstances to change product types eg from a standard variable loan to a line of credit.
You also have the choice of switching features within the same product eg changing from interest only repayments to principal and interest.
Why are there charges when I pay out my home loan?
As there are many costs in establishing loans, which are not covered by the application fee, should a loan be paid out early, usually within the first 5 years; then a deferred establishment fee will be charged.
This fee is based on the time at when full payment is being made and how much the original loan was for.
These fees only apply when the loan is paid out in full and the loan is discharged.
Where does Platinum get the money?
Platinum is a mortgage manager, who manages loans on behalf of wholesale funders. Wholesale funders are commonly large Australian or International banks who supply parcels on money to mortgage managers. Once these funds are sold as mortgaged securities, the funds are then pooled and sold via public bond issues to the investor market; where in turn the funders raise money.
