The 3 things first home buyers need to know
How much of a deposit do I need?
Typically, aiming for a deposit of 20% of the total home value is recommended. Government grants may be available to help, however if you still can’t achieve the funds you need, alternatives may be available to you such as Lenders Mortgage Insurance (LMI), where you may be able to borrow up to 95% (an insurance premium applies that you may be able to add to your loan), or a security guarantee from an eligible family member, where they use equity in their property to support your loan.
How much can I afford to borrow?
What you can afford to borrow from us will be based on your income, expenses, lifestyle, and other personal factors. Want to get a quick idea of what you can borrow? Check out our borrowing power calculator.
How does the approval process work when I'm house hunting?
Getting conditional approval (also called pre-approval) is the first step to getting your home loan approved, and means you can confidently make offers. A conditional approval lets you know how much you can borrow and confirms the deposit you’ll need (provided your situation stays the same and the property meets our lending criteria). A conditional approval is valid for 90 days.
Choose the loan that suits you
Classic
Our variable rate, no frills loan.
- Our lowest variable interest rate
- Redraw facility
- Low fees offering great value
Additional features
- Choose from principal and interest or interest only
- Online banking
- Visa debit card
- Minimum loan size $50k
Plus
If you’re looking for more features and more flexibility.
- Choose between variable or fixed interest rates (or a combination)
- Up to 8 offset accounts available for both variable and fixed rate loans
Additional features
- Redraw facility
- Low fees offering great value
- Choose from principal and interest or interest only
- Online banking
- Visa debit card
- Minimum loan size $150k
Rates & Fees
Buying your first home has never been easier with our great value home loans.
See our full rates and more information about our fees and charges.
Owner Occupied Principal & Interest
| Rate Type | Classic Interest Rate | Classic Comparison Rate | Plus Interest Rate | Plus Comparison Rate |
|---|---|---|---|---|
| Standard Variable Rate | 6.24p.a. | 6.45p.a. | 6.34p.a. | 6.76p.a. |
| Fixed 1 Years | - | - | 6.34p.a. | 6.76p.a. |
| Fixed 2 Years | - | - | 6.39p.a. | 6.77p.a. |
| Fixed 3 Years | - | - | 6.44p.a. | 6.79p.a. |
Owner Occupied Interest Only
| Rate Type | Classic Interest Rate | Classic Comparison Rate |
|---|---|---|
| Standard Variable Rate | 6.44p.a. | 6.64p.a. |
| Fixed 1 Years | - | - |
| Fixed 2 Years | - | - |
| Fixed 3 Years | - | - |
For more information about our fees and charges click here.
Classic or Plus
Not sure which home is the best fit for you? No worries!
Click here to check out all the details on our Classic and Plus home loan options, and find the perfect match for your needs.
How to apply
When you visit us in branch, we will take you through the first home loan application process from start to finish. You will need to:
1. Contact our Home Loan Specialist.
2. Provide us with supporting documentation.
Want to dive deeper?
Who is Cairns Bank?
Cairns Bank is the trading name of Cairns Penny Savings & Loans Ltd. We’ve been supporting the Cairns community with their banking needs for over 125 years.
We take pride in our personal approach to banking. Getting to know our customers and delivering simple products and services is what we’re all about.
And as a customer owned bank we make decisions based on our customers’ needs, rather than the needs of shareholders.
What is the difference between a fixed and variable interest rate?
A fixed rate loan allows you to lock in your interest rate for a fixed period of time, protecting you from rate rises. However, it’s important to keep in mind break cost fees may apply.
A variable rate loan on the other hand, has an interest rate that can change over time, depending on what is happening in the market. While this could see your repayments go up or down, often a variable rate home loan can come with greater flexibility.
What is the difference between the interest rate and comparison rate?
During your home loan search, you may have noticed that two interest rates are listed – the interest rate and comparison rate.
The comparison rate includes other fees associated with the loan, allowing you to see the true cost of the loan. Comparison rates will use a sample loan amount and term, so it is wise to take the time to run the numbers for your specific circumstances.
Comparison rates are calculated on a loan amount of $150,000 over 25 years with monthly repayments.
What does loan to value ratio mean?
The Loan to Valuation Raio (LVR) is the amount you borrow against a property calculated as a percentage of the value of your property itself. For example, if your loan amount is $400K and Cairns Bank’s security value of your property is $500K, then your LVR is 80%.
What is lenders mortgage insurance?
If your deposit turns out to be less than 20% of the property’s value, then Lenders Mortgage Insurance (LMI), is likely to apply. To put it simply, LMI is a one-off payment, which is typically added to the loan amount. It protects the lender if you were to default on the loan.
However, there are other options available to avoid paying LMI such as a Security Guarantee from an eligible family member, which utilises equity in their property so that mortgage insurance is not required.
Contact our lending specialists today to discuss your options and see how we may be able to assist you.
What are the upfront costs of taking out my first home loan?
Once you have saved your first home deposit, there are a few other costs to budget for including:
- Stamp duty, which is a tax and territory charge. Use our stamp duty calculator to work out how much you will need to pay
- Building and pest inspection fees
- Conveyancer or solicitor fees
- Mortgage registration fee
- Lenders mortgage insurance, if your deposit is less than 20%, as mentioned above
- Removalist fees, if you’re moving into the property
After you have purchased the property, you will also need to budget for the ongoing fees, such as:
- Home loan repayments
- Council rates
- Water rates
- Strata fees, if you’re purchasing an apartment, townhouse or villa
What is an offset account, and do I need one?
An offset account is like a regular transaction account, with one key difference: it is linked to your eligible home loan and can save you money.
Just like a regular transaction account, you can make deposits or withdraw from your offset account, whether online, using a debit card or at an ATM.
The difference is that the money you have in this account is then fully set-off against the outstanding balance of your home loan when we calculate loan interest. This means the interest you pay is based on your home loan balance less the balance in your offset account.
At Cairns bank, an offset account comes attached to your home loan, and you can open up to eight offset accounts.
To find out more click here.
What will I need to apply for a home loan?
When you visit us in branch, there are several documents that you will need to bring with you. Visit our How to apply for a home loan page for a full rundown.
What comes next?
Once your loan is approved, you will receive pre-approval, and can start the fun part – looking for that perfect first home.
Tools and Calculators
Apply for your first home loan today
To find out more or to apply for your first home loan, book an appointment with our friendly team or visit us in branch.
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