22/11/2025
Getting ready to build your dream home? Before you dive in, itās important to understand the key finance terms youāll hear along the way, so you can feel confident from pre-approval to handover.
āØ Borrowing capacity
This is how much your lender will let you borrow. Itās based on your income, expenses and debts, and it helps set your home-building budget.
āØ Interest rate
The percentage your lender charges on your loan. When the RBA changes the cash rate, your interest rate often follows.
āØ Comparison rate
A more accurate view of your loan cost, combining the interest rate and standard fees into one number so you can easily compare lenders.
āØ Fixed vs variable rate
A fixed rate means your repayments stay the same for a set time. A variable rate can change with the market, giving flexibility but less predictability.
āØ First Home Owner Grant (VIC)
If youāre buying or building your first home valued up to $750,000, you could receive $10,000 from the Victorian Government.
āØ Lenders Mortgage Insurance (LMI)
If your deposit is under 20%, youāll need to pay LMI. It protects the lender if you canāt repay your loan.
āØ Stamp duty
A government tax on property purchases. The amount depends on your homeās value, and first home buyers may be eligible for concessions.
Thereās a lot to take in when it comes to finance, but donāt worry, our team works closely with the experts at Resolve Finance, part of the ABN Group, to help guide you through every step.
Questions? No problem ā“
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