While the home buying journey is an exciting one, it is also important to be aware of all the fees associated with your home loan application so that you can put some money aside to cover these expenses and be prepared.
Here we outline the fees applicable on a Pepper Home Loan.*
What fees will I need to pay on or before my loan settles?
There are some fees that will need to be paid before your loan settles - each fee is dependent on the loan product you apply for.
- Establishment Fee: A one-off application fee that is required on all new loans, including refinancing existing Pepper Money loans.
- Valuation Fee: This fee covers the cost of an independent property valuer to conduct a valuation on your property. At Pepper Money, if the valuation is ordered by us, this fee is often included as part of the establishment fee or charged upfront if the cost of the valuation is substantial. You can learn more about a property valuation here.
- Title Protection Fee: A one-off, non-refundable fee that protects Pepper Money against loss caused by legal matters relating to the title of the property (such as the transfer of a deed or similar). This fee is similar to the Title Protection Insurance that is charged by some lenders.
- Legal Fee: Covers the cost of our panel solicitors to prepare loan contracts and attend settlement among other legal matters.
What fees do I need to pay after my loan settles?
If a risk fee is applicable to your home loan product, this will need to be paid upon settlement of your loan.
- Lender Protection Fee (LPF): A one-off, non-refundable fee used to offset the risk associated with loans of a higher Loan to Value Ratio (LVR). This fee is similar to Lenders Mortgage Insurance (LMI), and protects lenders against events like a defaulted loan.
- Mortgage Risk Fee (MRF): similar to LPF, MRF is a one-off fee payable by you to protect Pepper Money from a possible financial loss if you're unable to meet your home loan repayments due to an unfortunate event.
Did you know? On a Pepper Home Loan, LPF may be paid either at settlement as a lump sum or capitalised to your loan. It’s important to note however the capitalised fee must not cause your loan to exceed the maximum allowable Loan to Value Ratio (LVR) for your products and that it meets the required servicing requirements.
Are there any ongoing fees that I have to pay during the life of the loan?
Monthly Administration Fee: A monthly fee for administering your loan. This is charged on the same day each month as the settlement date.
What happens if I decide to pay off my home loan early?
We may charge you a discharge fee, as well as a solicitor’s fee upon ending your home loan agreement. The discharge fee is stipulated in the conditions of the loan contract, so you know upfront what the costs are before signing the dotted line. At Pepper Money, an additional break fee may apply if you are on a fixed rate loan. You can learn more about home loan break fees here.
Remember that fees and charges can vary between Lenders, so it is important to ask your credit provider for an up-to-date list.
To find out which Pepper Money home loan product could work for you, or if you have some questions you'd like answered around our fees and charges and when they apply, speak to a Lending Specialist on 13 73 77. We have a variety of flexible home loan solutions whether you're looking to refinance, buy your first home or add a new property to your portfolio.
*These fees and charges are correct as at 23 January 2018 and are subject to change at any time. Other fees and charges may apply depending on the applicant’s circumstances.
This article provides you with factual information only, and is not intended to imply any recommendation about any financial product(s) or constitute tax advice. If you require financial or tax advice you should consult a licensed financial or tax adviser. Neither Pepper nor its related bodies, nor their directors, employees or agents accept any responsibility for loss or liability which may arise from accessing or reliance on any of the information contained in this article. For information about whether a Pepper loan may be suitable for you, call Pepper on 13 73 77.