Understanding stamp duty and other purchasing costs

As well as the cost of obtaining your home loan, there are fees and charges associated with buying a property.

Direct Credit Home Loans has put together a general guide to property purchasing costs so we can help you fully understand what applies in your circumstances and estimate costs based on the price of your property.

Stamp duty and transfer fees

  • Purchase Stamp Duty: a government stamp duty charge based on your property purchase price. This is payable after exchange but before you settle.
  • Mortgage Stamp Duty: No Longer Charged
  • Transfer Fees: are charged by some states. Check with your legal representative.
  • First home buyers are generally given some relief on stamp duty costs. In some cases, you may be eligible for a stamp duty exemption.

How Much is Stamp Duty?

The amount of stamp duty paid will vary from state to state and depend on whether you are a First Home Buyer or not. Use our stamp duty calculator to calculate the amount payable in each state.

Document transfer and title registration costs

These are government fees applied to each document that is lodged for registration on the property title. Typically there is one transfer document and one mortgage document that you’ll need to pay for at the time of settlement.

Other fees

Legal fees

  • You’ll have to pay for solicitors or legal representative services such as reviewing the purchase contract and advising you on your mortgage documents. The cost of this service varies widely and it’s best to ask what it is up front.
  • There are also extra fees associated with property inspections.
  • It is in your interest (but not compulsory) to get a pest or building inspection completed on the property.
  • Sometimes property surveys and searches can be required.
  • Your legal representative can arrange these or you can arrange them yourself.

Lender’s Mortgage Insurance

  • Depending on what your deposit is, you may have to pay Lender’s Mortgage Insurance (LMI).
  • This protects the lender if you default on your loan.
  • LMI does not cover the borrower.
  • Generally, you will be required to pay LMI only if you have a deposit that is less than 20 percent of the purchase price of the property.

Home loan application fee

  • Direct Credit’s application fee covers the approval, excluding valuation and our solicitor’s costs of preparing the loan documentation and attending settlement.
  • Our solicitors may incur expenses at settlement, for example, bank cheque fees. You will be responsible for these costs.

Please use this information as a guide only – it is not advice. You should seek professional advice when buying a property or taking out a loan and always refer to your loan contract for full terms and conditions.

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