What are balloon payments?

September 20th, 2010

Balloon payments are a feature of some home loans, providing the facility for the lender to accept a large lump sum payment in addition to, or instead of, the usual monthly payments. Some balloon payments are scheduled, although these types of mortgages tend to be quite rare in Australia. With a scheduled balloon payment, if the payment is not made, the home loan is in default and the house could be repossessed.

Getting a mortgage with a future lump sum

September 17th, 2010

Because mortgage decisions by lenders tend to rely heavily on regular income, they aren’t necessarily designed for someone expecting a future lump sum, such as an inheritance or return from an investment. There are certain types of mortgages better suited to borrowers awaiting such a settlement, and certain features that should be looked for while others are avoided.

How to pay in a lump sum to a mortgage

September 16th, 2010

Sometimes a homeowner receives a large lump sum, perhaps as an inheritance, through the sale of an asset or investment, or as a particularly large commission payment or bonus. In these cases, one of the logical choices for the windfall is to simply pay down the mortgage, and this can make a great deal of sense.

Will a home loan lender take account of my commission payments?

September 15th, 2010

One problem with home loans is that they were designed for people with stable, long-term employment. They don’t necessarily take into account newer patterns of employment, which may be reward-based and so fluctuate more, for example, a commission-based salesman.

What factors do home loan lenders look at?

September 14th, 2010

Home loan lenders look at a wide number of factors before advancing a loan. However, there are a number of major factors that usually acquire greater weight during the deliberation process.