Tarzan Home Loans - Frequently Asked Questions

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Frequently Asked Questions

What are the common mistakes in buying or refinancing a house?
How much do you charge?
Where does Tarzan Home Loans get the money?
How will I know what program is right for me?
How much can I borrow?
Do I need a deposit?
I'm purchasing a block of land; do I have to enter into a building contract to get finance?
Are there any properties Capital Funding Group does not lend against?
My financials aren't not up to date and I am self-employed with equity in property can you help?
What if I have had bad credit problems in the past?
What if I have filed bankruptcy?
What if I have just started a new job?
How much will my costs be?
What is mortgage insurance?
Why do I need to show genuine savings? What are genuine savings?
What is the difference between a FullDoc and LoDoc loan?
Once I submit an application what happens next?
Once I complete the application form, what other documents do I need to supply?
Are there any charges for paying my loan out early?
How is interest calculated?
Why would I take out an interest only loan?
What is a Deposit Bond?
Can I switch my loan between programs & products?
Can I make extra payments?
How do I redraw or make extra lump-sum repayments?

What are the common mistakes in buying or refinancing a house?

When people purchase a new house or re-finance they often forget about the government and lenders fees. This can cause a shortfall in funds to complete the transaction. People also often approach their current bank, which can often cost them more money, as they do not compare the cost of the loan with the competition.

How much do you charge?

Our professional service is obligation-free and is provided to you at no cost.

Where does Tarzan Home Loans get the money?

Tarzan Home Loans is owned by Capital Funding Group. Capital Funding Group operates as a mortgage originator and manager, and our objective is to provide an innovative and cost effective range of mortgages to the people of Australia.
Capital Funding Group is responsible for the day to day management of your mortgage, which means that when you have a query or request regarding your mortgage, we are able to assist you directly and promptly.
Our funds are provided by various wholesalers (bond issuer) who obtain their funding by securitising mortgages and selling the associated cash flows to various intuitional investors.
Both Capital Funding Group and the wholesalers are then overseen by a trustee who sets high standards and ensures that all mortgages comply with strict requirements and both the Bond Issuer and ourselves maintain continuous high standards. At all times your mortgage is safe, and as long as it is serviced in a timely manner, it will never be called in.

How will I know what program is right for me?

We will discuss with you your personal situation and then let you know what program would be most suitable for you. The type of program selected will depend on your financial and work situation. Please contact us to discuss this further.

How much can I borrow?

As a guide, what you can borrow is determined by what you earn less your cost of living and other financial commitments. All lenders have different ways of calculating how much you can borrow.
Check our "How Much Can I borrow Calculator" on this website.

Do I need a deposit?

When you are purchasing a home, the minimum deposit required is generally 5% of the purchase price and most lenders expect this deposit to come from genuine savings. If you are purchasing your second home, you may be able to borrow the full purchase amount plus costs by using the equity in your existing property.

I'm purchasing a block of land; do I have to enter into a building contract to get finance?

No, we do loans against vacant land and then transfer the loan facility to a construction loan when you are ready to build (Construction must commence within a two year period).

Are there any properties Capital Funding Group does not lend against?

Yes, there are some properties that may be considered unacceptable security, some of which are:

Converted factory or warehouses
Resort apartments
Hotel/motel rooms
Serviced or managed apartments
Studio apartments that are under a certain size.

However, there is no one rule that deems these are certain; for more detailed information on acceptable and unacceptable security, we recommend you speak to us about your specific request.

My financials aren't not up to date and I am self-employed with equity in property can you help?

Yes, we have a whole range of products that suit mostly all situations. Please contact us to discuss your individual situation.

What if I have had bad credit problems in the past?

People who have credit problems are still able to get loans through non-confirming lenders. These lenders specialise in loans for people who do not fit into the prime market. The rates are slightly higher to cover the risk of the lender. Please contact us for further details.

What if I have filed bankruptcy?

If you have been bankrupt in the past but it has been discharged, you are still able to get a loan through a non-confirming lender. A person who is bankrupt is not able to borrow money from financial intermediaries.

What if I have just started a new job?

People who have just started a new job can still get a loan in most circumstances such as moving within the same industry, or having good savings.

How much will my costs be?

In addition to your deposit, you also need to allow for additional costs, such as government fees and taxes, usually between 3-6% of the purchase price. From time to time, Federal and State governments offer financial assistance to first home buyers and/or owner occupiers to offset some of these purchase costs. Check our Stamp Duty Calculator. Please call us for further information. In most cases you will also have to pay Mortgage Insurance.

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 due at settlement of the loan.
Mortgage insurance covers the lender 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.

Why do I need to show genuine savings?
What are genuine savings?

Genuine savings is money that you have saved in your own name. Savings can be in the form of bank savings; shares etc and is usually over a 6 month period.
Genuine savings are used to demonstrate the borrower's 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.
Where the borrowers do not have 5% genuine savings, we have another sub-program within our standard program called Standard Program NGS (90/10).

What is the difference between a FullDoc and LoDoc loan?

LoDoc 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.
FullDoc loans are those where the borrower proves their income by providing evidence such as group certificates, pay slips, tax returns etc.

Once I submit an application what happens next?

The application is assessed, whereby credit checks, 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 our nominated 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. As 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.

Once I complete the application form, what other documents do I need to supply?

Documents need to be supplied to verify the contents of your application form. The most common documents requested are:

100 point of ID
A current payslip (not more than a month old)
Last 2 years Group Certificates or Tax Returns
Bank statements
Loan statements
Council rates
Contract of sale

Are there any charges for paying my loan out early?

Should a loan be paid out within the first 5 years, then a deferred establishment fee will be charge.
This fee is based on the time at when full payment is being made and how much the original loan was for.
The deferred establishment fees differ depending on your loan type.

How is interest calculated?

Interest is calculated on the daily balance of your loan. If you are paying principal 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 maximize 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.

Are there any properties Capital Funding Group does not lend against?Yes, there are some properties that may be considered unacceptable security, some of which are:

Converted factory or warehouses
Resort apartments
Hotel/motel rooms
Serviced or managed apartments
Studio apartments that are under a certain size.

However, there is no one rule that deems these are certain; for more detailed information on acceptable and unacceptable security, we recommend you speak to us about your specific request.

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.
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.

Can I switch my loan between programs & products?

Yes, you have the ability in most circumstances to change program & product types, e.g. from a standard variable loan to a line of credit.
You also have the choice of switching features within the same product, e.g. changing from interest only repayments to principal and interest.

Can I make extra payments?

That depends on the type of loan you have, but usually restrictions only apply on fixed rate loans.

What happens if I make extra payments?

Because any extra that you pay reduces your loan principal first, you immediately make interest savings and this has the effect of reducing the overall term of your loan.
You may redraw any amount of the loan principal that has been paid in excess of the amount due at any particular date. There are no fees or charges for using this feature.