Home Loan FAQs Frequently asked questions about home loans, SMSF loans, asset finance and business finance, answered by our brokers.

A lender is a business or financial institution that extends credit to companies and individuals, with the expectation that the full amount of the loan will be repaid. Lenders charge interest, a percentage of the amount lent. Before you enter a loan, a lender must make reasonable enquiries so that it is satisfied the contract is likely to meet your needs and that you will be able to make your repayments without substantial hardship. Our brokers at Greenline Home Loans help you reach an informed decision and match you with products that fit your requirements.

There are five common things lenders look at when assessing a loan application. Credit score and history: your repayment history, outstanding debt and the length of your credit history. Income: evidence such as bank statements, payslips and recent tax returns, to show you can repay the loan. Debt-to-income ratio: the share of your gross income that goes to debt repayments, which lenders use to gauge your ability to take on new debt. Security: for a secured loan, the property or asset the loan is secured against; if you fall behind, the lender can sell it to recover the balance. Fees: lenders may charge application, valuation and settlement fees, which a broker can explain before you commit.

It depends on your preference. A broker is often the more convenient option because they know the many loans on the market and can suggest the one most suited to your situation, and they can negotiate interest rates and other terms on your behalf. In most cases a broker's service costs you nothing directly, because the lender pays the broker once your loan settles. Greenline compares 50+ lenders; a bank offers only its own products.

Ask how many lenders they compare and which ones they are accredited with; how they are paid and whether you pay a fee; who handles your file after settlement; how long approvals typically take with the lenders they suggest; and what happens if your application is declined. A broker should give you their Credit Guide early on, so ask for it: you can read our Credit Guide now.

A pre-approval is conditional approval from a lender to borrow up to a certain amount before you have found a property. Nothing is final at this stage, and the lender can still decline your formal application. A pre-approval gives you a clear budget to shop with, narrows your search and saves you looking at homes beyond your reach. Greenline Home Loans can arrange your pre-approval: contact us today.

A variable rate loan has an interest rate that may change from time to time. Rate movements typically follow the Reserve Bank of Australia's announcements, though the change might not be the full rate cut or rise. A fixed-rate loan has a rate that is set when the loan is fixed and stays the same for the fixed term, usually between 1 and 5 years; the rate offered varies by term with the lender's expectations of future RBA movements. Variable loans generally offer more features, such as an offset account, a redraw facility and extra repayments, while fixed loans tend to be less flexible. You can also split your loan, holding part fixed and part variable, and get the benefits of both. To find the right structure for you, speak to one of our brokers.

An offset account is a transaction account linked to your loan: the cash in it offsets the loan balance that interest is charged on. For example, with a home loan balance of $500,000 and $10,000 in your offset account, you pay interest on $490,000 only. The cash stays available to you because it is not paid into the loan. Lenders calculate interest daily, so an offset account is a good place to have your salary paid into.

An interest-only loan is one where, for a set period, you repay only the interest, so the repayments are lower because no principal is included. The loan balance does not reduce during that period. Interest-only loans are typically used by investors managing cash flow on investment properties, or maintaining their loan balance for tax reasons. Lenders usually offer interest-only terms of up to 5 years, after which the loan reverts to principal and interest repayments over the remaining term. Interest-only loans also tend to carry higher interest rates than principal and interest loans, so the decision deserves careful thought.

Negative gearing is a term for property investors. Your investment is negatively geared when its annual expenses are higher than its annual rental income; if the rental income is higher than the expenses, it is positively geared. The benefits of negative gearing are often tax-related, while positive gearing helps cash flow. If you are considering an investment property and want to discuss gearing strategies, contact us today.

Lenders mortgage insurance (LMI) is insurance a lender takes out to protect itself if the borrower cannot repay the loan. It generally applies to lending above 80% of the property value, based on the lender's valuation, and the borrower pays the premium. LMI can sometimes be capitalised into the loan, so you do not need the cash up front, and some lenders waive it for certain professionals such as accountants, lawyers and engineers. To find out what LMI would cost on your purchase, contact us.

The comparison rate is the rate listed next to the advertised rate. It is calculated taking into account the fees and charges that apply to the loan, based on a loan of $150,000 over 25 years, so it helps you compare the true cost of different loans. Make sure you understand every fee and charge on a loan, and what the loan's features give you for them. Our comparison rate calculator shows how it works.

Mortgage brokers do not lend money. A broker's role is to find the lender that best suits your circumstances: they work with many lenders and act as the matchmaker. A mortgage lender provides the mortgage itself, the loan you use to buy a property and repay over time. Without a broker you would need quotes from several lenders to compare your options; a broker does that for you.

When you apply for a loan, you can often apply for additional borrowing to consolidate credit card debt or personal loans. That can reduce the interest rate on your existing debt, although spreading short-term debts over a mortgage term can cost more in total interest unless you repay them faster. If you already have a mortgage, a refinance with cash out is one way to consolidate debt: see debt consolidation. To find out whether you can save on interest, contact us today.

A self-managed super fund (SMSF) is a super fund you run yourself. It gives you more flexibility and lets the fund hold assets such as shares, term deposits, cash and property. An SMSF can be very successful, but it carries more responsibility than an APRA-regulated fund. An SMSF needs its own Tax File Number (TFN), Australian Business Number (ABN) and transaction bank account, and because it is a trust, its trustees are responsible for the investment strategy, administration and financial statements.

An SMSF loan application is the set of documents a lender needs to approve the loan. Each lender's requirements differ, but most ask for copies of the SMSF trust deed, the custodian (bare) trust deed and the contract of sale. You will also be asked to show sufficient income, bank statements, tax returns and audit certificates, so the lender can confirm everything is in order and that the fund can afford the repayments.

It depends on the fund's financial position, the lender and its policies. Lenders offer SMSF loans ranging from $100,000 up to $4,000,000; Greenline's own SMSF products allow up to $2,500,000 on one security with total exposure of up to $4,000,000. Lenders may also require the fund to keep a minimum balance after the purchase, or a percentage in liquid cash, though some waive this when the deposit is large or the rental income covers the repayments. See SMSF loans.

No. Under the superannuation rules, once the fund has bought a property it cannot refinance to take cash out or use the property as equity to buy another. The only way to access the equity is to sell the property. If your SMSF already holds a property and wants to buy another, the fund needs enough cash of its own for the deposit and purchase costs.

All SMSF borrowing must be through a limited recourse borrowing arrangement (LRBA). The SMSF trustee borrows from a lender and uses the funds to buy a single asset, which is held in a separate trust. Investment returns from the asset go to the SMSF. If the fund fails to pay the principal or interest, the lender's rights are limited to that asset: there is no recourse to the other assets in the fund.

The main requirements are that the sole purpose of the property is to provide retirement or death benefits to the fund's members; that the property is a single acquirable asset; and, since 10 August 2026, that a new loan is used for business real property, such as commercial premises, because an SMSF can no longer take out a new limited recourse borrowing arrangement to buy residential property. Existing residential SMSF loans continue and can be refinanced, subject to lender policy. See SMSF commercial loans and SMSF residential loans.

The loan-to-value ratio (LVR) is how much you borrow compared with the value of the property. A larger deposit means a lower LVR, and a lower LVR means less risk for the lender. The maximum LVR for SMSF loans varies by lender.

Yes. It is possible to refinance an existing SMSF loan, although fewer lenders offer SMSF loans for that purpose. Many funds took out SMSF loans when rates were higher or when their situation was different, so it is worth reviewing whether a better option exists. Refinancing an existing residential SMSF loan remains allowed after the 10 August 2026 change. See SMSF residential loans.

Not with a new loan. Since 10 August 2026 a self-managed super fund cannot enter a new limited recourse borrowing arrangement to buy residential property. Loans that already existed on that date continue, and they can be refinanced subject to lender policy. An SMSF can still borrow to buy business real property, such as the premises your business operates from: see SMSF commercial loans.

Greenline's SMSF products lend up to 80% of the value of a commercial property. For example, if the fund buys a commercial property for $400,000, the maximum loan is $320,000, so the fund needs $80,000 of its own cash to complete the purchase, plus acquisition and loan costs.

The fees that generally apply to an SMSF loan are an application fee, a valuation fee, legal fees, monthly administration or service fees, and early repayment fees. Your broker will set out the fees that apply to the loan you are considering before you commit.

Yes, but only certain lenders offer one. Greenline offers a 100% offset account on its SMSF loans. An offset account is a valuable feature for an SMSF loan: the cash the fund holds offsets the loan balance, which reduces the interest charged each month.

Lenders consider many factors when assessing a business loan application, including your business experience, how much of your own money you are putting into the deal, the type of business you own and any security property. You are more likely to qualify if you have an established business in a low-risk industry. There are no set rules, though: business loans are generally assessed case by case.

It depends on the lender, the loan product and the lender's assessment of your application. Greenline Home Loans has a partnership with a specialist lender that provides unsecured small business loans from $10,000 to $250,000, and we compare secured business and commercial lending across our panel. See business and commercial loans.

A merchant cash advance is generally the simplest business finance to obtain, but it is also one of the most expensive. The provider buys a share of your future card sales: it advances you a set amount, and you repay it as a small percentage of your daily card takings. Merchant cash advance providers usually move quickly and have flexible eligibility requirements. See merchant cash advance loans.

There is no set deposit for a business or commercial loan, because every business is different, but many lenders look for 10 to 30 per cent of the purchase price. The money can come from savings, working capital, other finance or an outside investor. The deposit you need depends on the amount borrowed, the purpose of the loan, your personal credit history and your business credit history.

Unlike residential home loans, commercial property loans generally run from 5 to 20 years, and the repayment period is often longer than the loan term. For example, a lender may write a commercial loan for a term of 7 years with repayments calculated over 30 years: the borrower pays for 7 years as if the loan ran for 30, then makes a final balloon payment of the remaining balance. See commercial property loans.

A loan without collateral is an unsecured loan. The main differences are that you usually cannot borrow as much and you pay a higher interest rate. Some loans need no existing collateral because the thing you are buying becomes the security: with equipment finance, for example, the equipment itself secures the loan while you repay it.

With no credit record at all, a business loan can be hard to obtain, and the same is true of a poor credit history from late payments or bankruptcy. If you have no record, start somewhere: a personal credit card with a low limit, paid on time every month, builds a positive record for when you need a larger personal or business loan. If you have bad credit, a few non-bank lenders specialise in business loans for that situation, though they charge higher rates for the higher risk.

A commercial loan is arranged between a lender and a business. It is generally short-term, though the lender may allow renewals and extensions. Businesses use commercial loans to expand their facilities, enter new markets, buy equipment or property, or pay off debt. At Greenline there is no one-size-fits-all: a promising start-up seeking its first finance and an established company buying another business need very different loans, so we take a customised approach.

You can apply for an overdraft facility once a lender approves your business for it. Lenders generally look for solid business turnover, shown through your latest balance sheet and profit and loss statement; equity in an existing property to use as security, with some lenders allowing borrowing of up to 85 per cent of the property's value for business purposes; and a legitimate, ongoing business need for an overdraft rather than a one-off cost. Greenline can find you a lender that understands business owners: see overdraft facility loans.

Invoice financing has become a popular alternative to a bank loan for businesses that invoice their customers. It is less restrictive than a traditional loan, offers more flexibility, and can improve your cash flow and overall profitability by turning unpaid invoices into working capital. To find out more, see invoice financing or contact one of our brokers.

Both provide capital, but they work differently. A business line of credit is revolving credit: you draw on it as you need, interest accrues on the balance you hold, and if you do not use it you make no payments. As long as you make the minimum payment each month, you can repay the balance in full or whatever you can afford, and the unpaid balance accrues interest. A business loan is instalment credit: you receive a lump sum and make fixed repayments from the start, whether or not you have used the money. Some loans are also limited to particular uses, whereas a line of credit can be used for any business purpose. See business line of credit loans.

You may be asked for financial statements, proof of income, bank statements and identification. If you are a start-up, you may also need cash-flow projections, a business plan, the business contract of sale and your lease agreement.