The 50 Most Common Home Loan Questions Answered

Everything Australians Want to Know About Home Loans, Buying Property and Refinancing

Buying a property is exciting, but it can also be overwhelming. Every week at Nexus Loans, we're asked hundreds of questions from first home buyers, investors, families, and homeowners looking to refinance.

Rather than keeping those answers to ourselves, we've put together one comprehensive guide answering some of the most common home loan questions we hear.

Whether you're buying your first home, building, investing, refinancing, or simply planning ahead, this guide is designed to help you make informed decisions with confidence.

First Home Buyer Questions

Do I need a 20% deposit?

Not always. Depending on your circumstances and lender policy, some buyers may be able to purchase with a smaller deposit. Government schemes and guarantor loans may also be available for eligible borrowers.

Can my parents help me buy a home?

Yes. Some lenders offer guarantor home loans, allowing eligible family members to use equity in their property as additional security rather than giving you cash.

What government grants are available?

This depends on your state and personal circumstances. You may be eligible for the First Home Owner Grant, stamp duty concessions, or the Home Guarantee Scheme.

How much can I borrow?

Your borrowing capacity depends on factors such as your income, expenses, existing debts, dependants, credit history, and the lender's assessment criteria.

Is pre-approval worth getting?

Absolutely. Pre-approval can give you confidence when house hunting and provide a better understanding of your borrowing capacity before making an offer.

Refinancing Questions

When should I refinance?

Many homeowners review their loan when interest rates change, but it's also worth considering after a pay rise, starting a family, renovating, purchasing an investment property, or if your fixed rate is ending.

Will refinancing save me money?

It may, depending on your current interest rate, loan features, fees, and financial goals. A home loan review can help determine whether refinancing is suitable.

Does refinancing affect my credit score?

A refinance application may result in a credit enquiry, but refinancing itself doesn't automatically damage your credit score. Responsible credit management remains the most important factor.

Can I refinance if I'm self-employed?

Yes. Many lenders offer home loans for self-employed borrowers. Depending on the lender, options may include one-year financials, BAS, or alternative documentation.

Can I refinance with tax debt?

Potentially. Some lenders will consider applications where ATO debt exists, provided there is a suitable repayment arrangement or other acceptable circumstances.

Investment Property Questions

Can I buy an investment property using equity?

Yes. Many investors use available equity from their existing property to help fund the purchase of another property, subject to lender approval.

Should I choose Interest Only or Principal & Interest?

It depends on your financial goals. Interest Only loans may improve cash flow, while Principal & Interest loans reduce your loan balance over time.

Can I use rental income to borrow more?

Most lenders will include a percentage of expected rental income when assessing borrowing capacity.

How many investment properties can I own?

There is no fixed limit. It depends on your financial position, borrowing capacity, and each lender's policies.

Building & Renovating Questions

Can I build with a 5% deposit?

Potentially. Some eligible borrowers may be able to build with a smaller deposit, depending on the lender and available government schemes.

How do construction loans work?

Construction loans are generally funded through progress payments, with funds released to your builder as each stage of the build is completed.

Can I use equity to renovate?

Yes. Many homeowners use available equity to fund renovations rather than taking out a personal loan.

Can I buy land first and build later?

Yes. Many lenders offer land loans and construction finance, allowing you to purchase land before commencing your build.

Bridging Loan Questions

Can I buy before selling?

Yes. A bridging loan may allow eligible borrowers to purchase their next property before selling their existing home.

What is Peak Debt?

Peak Debt is the total amount borrowed while you temporarily own both properties during a bridging loan.

What is End Debt?

End Debt is the remaining loan after your existing property is sold and the sale proceeds are applied to the bridging facility.

Do I make two repayments during a bridging loan?

Not always. Some lenders allow interest to be capitalised during the bridging period, although policies vary.

Borrowing Capacity Questions

Does overtime count as income?

Often, yes. Many lenders accept overtime income where it is regular and consistent.

Can casual employees get a home loan?

Yes. Many lenders accept casual employment, provided you meet their employment history requirements.

Can I use Centrelink income?

Some Centrelink payments may be accepted by certain lenders, depending on the type of payment and individual circumstances.

Does HECS affect borrowing power?

It can. Lenders generally include HELP/HECS repayments when assessing your borrowing capacity.

Do credit cards reduce borrowing capacity?

Yes. Even if your balance is zero, lenders usually assess your approved credit limit as an ongoing commitment.

Lifestyle Questions

Can I buy while on maternity leave?

Potentially. Some lenders will consider applications where there is evidence of a return to work and sufficient income.

Can I buy after changing jobs?

Yes. Many lenders will consider borrowers who have recently changed jobs, depending on their employment history and occupation.

Can I buy after separation?

Yes. Many borrowers refinance or purchase a new property following separation. Lending options depend on your financial circumstances and any property settlement arrangements.

Can I buy acreage?

Yes. Many lenders finance acreage properties, although lending policies differ based on land size, zoning, and location.

Can I buy commercial property?

Yes. Commercial lending is available for eligible borrowers and businesses, with lending criteria differing from residential home loans.

Why Choose Nexus Loans?

No two borrowers are the same—and neither are lenders.

At Nexus Loans, we compare a wide range of lenders to help you find a solution that aligns with your financial goals, whether you're buying your first home, refinancing, investing, building, or purchasing commercial property.

Our role is to simplify the process, explain your options clearly, and provide advice that's tailored to your circumstances.

Have a Question We Didn't Answer?

We're always happy to help.

Book a free strategy session with Nexus Loans, and we'll answer your questions, explain your options, and help you move forward with confidence.