Home loan terms and mortgage definitions
An examination of records or documents at a Land Titles Office or Government Department to confirm ownership of property, registered easements and other encumbrances or current or future proposals in respect of the land.
A right of a lender against the real property or other assets of a borrower to guarantee or secure the repayment of a loan.
Also called a Duplex. This is a type of construction where two buildings are attached together by a common wall or walls.
The date on which documentation for the transfer of ownership of property from the seller to the buyer takes place upon finalisation of the purchase price. It is also usually the date on which the buyer assumes possession.
A person authorised to access an account or who has authority to sign and be bound by documents.
The loan is split into two (or more) accounts. Customers sometimes use this option to take part of their loan at a fixed interest rate and part of their loan at a variable interest rate giving them rate certainty on the fixed rate portion and flexibility on the variable rate portion.
Failure to meet your mortgage commitments by the due date Home owners who fail to pay their scheduled home loan repayments will breach their mortgage contract and be in default of the mortgage. If this occurs the lender is within their rights to take legal action – even to the point of repossessing the home – so it’s important that the situation is rectified as quickly as possible. If you’re having difficulty maintaining your loan repayments then you should contact the lender immediately. This gives you the opportunity to discuss any changes to your circumstances and may even allow you to arrange a variation of your contract or a hardship application. However, it’s important to make contact with your lender as soon as your circumstances change and prior to a default. If you fail to make a home loan repayment, the lender will normally contact you to enquire about your late payment and discuss any issues. If they’re unable to contact you, or if your issue is unable to be resolved and repayments continue to be missed, they’re likely to issue a formal notice (usually under s80 of the Consumer Credit Code) advising that you are in default of the loan. This notice will specify a date by which you need to rectify the situation and pay the outstanding amount. If you continue to default after the specified timeframe, the lender can commence legal proceedings to take possession of your property and arrange for its sale. The proceeds of the sale would then be used to compensate the lender for their loss.
Mortgage default is often caused by factors beyond our control, such as redundancy or unemployment, illness or injury, relationship breakdown or family issues. Often these events are temporary in nature and lenders may be willing to negotiate an alternative payment arrangement. If you’re affected by an external event and feel the mortgage commitments are beyond your capacity to pay, remember that you can talk to your lender. The most important step is to contact your lender as soon as possible to discuss your circumstances.
Of course, having difficulty meeting your repayment obligations may be a reflection of more deep-seated financial issues. Many home owners feel the strain when faced with unexpected expenses, multiple credit card debts or rising interest rates. The additional pressure on the household budget can become too much to bear and people may have difficulty prioritising their spending. If you’re experiencing financial difficulty, some options that may be available to you include:
If you need to discuss your current home loan repayment options, please call RAMS on 13 RAMS that's 13 7267. Fees, conditions, limitations and lending criteria apply. This information is of a general nature only and is not to be relied upon as being appropriate or suitable for your particular circumstances.
A State Government tax based on the value or purchase price of the property.
A form of title to a unit or lot on a plan of subdivision associated with townhouses, units and blocks of flats and based on the horizontal and vertical subdivision of air space. Owners have a certificate of title, are absolute owners of a freehold flat and have an undivided share of the common property.
Also called Company Title. As the owner you become a shareholder in the company that manages the common area, not just a member as in Strata title. Stratum units are regarded as unattractive because of difficulties and complexities involving the operation of the company, Corporations Law obligations and a reluctance on the part of lenders to accept them as security.
A plan that shows the boundaries, and the position, of any buildings within a block of land and confirmation whether the building complies with Local Government legislation.
A report that shows the likelihood of future pest infestations.
A fee charged to cover or partially cover the lender's internal costs of changing the loan from a variable rate to a fixed rate.
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