Next Home Buyers FAQs

Next Home Buyers may be looking for a bigger home, to move to a different location or for any number of reasons. If you’re thinking of buying your next home, talk to our mortgage brokers today.

See below for answers to the most common questions our brokers are asked by those who are thinking of moving on to their next home.

I've found the next property I want to buy, but I haven’t sold my existing property yet. Should I consider bridging finance?

Bridging finance is available to those who are looking to purchase or construct a new home prior to selling their current property. This is even if the proceeds of the sale of their existing home are required for the new purchase.

However, you will need to carefully explore all the options before you commit to buying a new home this way. For most people, it is far more advisable to sell your existing property first.

Talk to us to find out if bridging finance is suitable for your current financial situation.

How are repayments calculated during the bridging period?

While the sale of the existing home goes through, the minimum repayments are usually calculated on an interest-only basis. Depending on your lender you may be able to capitalise all repayments until the sale is completed (i.e. add them to the total amount of the loan). However, you should keep in mind that this option will cause your Peak Debt to increase, therefore increasing the overall interest you’ll pay.

Wherever possible, making some repayments during this time is recommended. This is so that if you do have difficulties in selling your property, you will not have an additional 6 months repayments added to your loan amount. Instead, the amount to be added to your loan will be reduced by whatever you have already repaid.

We have tools to help you work out how much your potential minimum repayments will be, so that you can anticipate the changes ahead.

Do I keep making repayments during the bridging period?

Your lender may allow you to choose to either capitalise your repayments (add them to the total amount of the loan), or continue to pay them.

If you continue to make repayments, this will stop the total amount of the loan ballooning, and limit the amount of additional interest being charged. If you are unsure as to whether to keep making repayments during the bridging period, talk to us today.

We’ll assess your current financial circumstances and advise you on an appropriate course of action.

Are there limits on how long I can take out bridging finance for?

You will normally have six months to sell the existing property, or 12 months if a new property is being constructed. If the property has not been sold by that time, the loan will be reviewed and new arrangements may need to be put in place.

Remember that a standard settlement in some states can take up to 6 weeks, so you need to take this into consideration when calculating the bridging period.

If you are unsure of how to calculate the bridging period to estimate the impact that it will have on your loan, consult with one of our mortgage brokers today.

How much money will I need to set aside for stamp duty?

Stamp duty is a state government tax based on a property’s selling price. Each state or territory has different rules and calculations; some states offer discounts to first home buyers.

Stamp duty can be a significant additional cost when buying property, and our mortgage brokers will advise you of the specific stamp duty cost related to your purchase.

Have more questions?

Talk to us for expert, tailored advice for Next Home Buyers.

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360 Degree Finance Services Pty Ltd
Suite 28, 50-56 Sanders Street, Upper Mount Gravatt QLD 4122
Authorised Credit Representative of Australian Credit Licence Number 384704