Glossary

Search (Title Search)

A request to the Lands Title Office to ascertain who owns a specified land and what encumbrances are on the title.

Security

An asset that protects a Lender's risk until the loan is fully repaid. Usually property, such as real estate, is offered as security.

Service Fee

Usually a monthly fee levied to cover bank cost of administering & maintaining the loan account i.e. fixed and variable costs such as staff, IT software / hardware

Settlement Date

Date on which the new owner finalises payment and assumes possession of land. Sometimes called the "Drawdown" date, as this is the date the loan is usually fully drawn.

Stamp Duty on Transfer

State Government tax assessed on the sale price of the property. First home buyers may be eligible for concessions on this.

Standard Variable Rate

The rate which lenders apply to their ‘premium’ home loan product. Carries features such as a redraw facility, portability, salary account and mortgage offset.

Strata Title

Similar to Torrens Title, but usually over units. With Torrens title, the land is owned plus everything thereon. With Strata Title, only a particular unit is owned.

Sub-prime lending

'Sub-prime lending', also called 'non-conforming' loans, refers to loans that cater for those who can't meet the standard income verification and credit history criteria mainstream lenders like banks and mortgage originators use for ordinary borrowers. Such borrowers include those who are self-employed, have a poor credit record or who have recently arrived in Australia. Non-conforming loans are usually at higher interest rates to reflect higher risk of these borrowers.

Survey

A plan that shows the boundaries and the building position on a block of land.

Switching Fee

The lender may impose a switching fee where an existing borrower wishes to change from one loan type to another e.g. Variable Rate Loan to Fixed Rate Loan