Auction
Method of sale where interested buyers bid on a property in competition with each other.
Body corporate
Also known as owners corporation, is the body that owns the common areas in a property, and the building structure itself. Together, all the owners of the individual lots in the strata plan make up the owners corporation.
Bridging finance
A loan taken out to bridge the gap between providing funds for the purchase of a property and receiving funds from the sale of a property.
Company title
A form of title where you do not hold individual title to a property, but rather you own shares in the company that owns the building and land.
Consumer Credit Code
A law governing consumer lending in Australia.
Contract of sale
The agreement containing the terms and conditions of a property sale.
Conveyancing
The legal process by which the ownership of a property is transferred from seller to buyer.
Cooling off period
A set period during which the buyer of a property can back out of the purchase (does not apply in all states or for properties bought at auction).
Debt
The amount of money you have borrowed from a bank or other lender.
Deposit bond
A document from an insurance company that guarantees payment of a deposit on a property purchase.
Easement
A right to use land belonging to someone else. For example, mains, drains and water pipes are usually covered by an easement.
Equity
The difference between what you owe and the value of what you own. Negative equity means you owe more than the total value of what you own.
Establishment fees
Fees charged by your mortgage provider to set up the loan.
First Home Owner Grant
A Government scheme to help first home buyers.
First Home Saver Account
A tax preferred savings account for first home buyers to save a deposit.
Fixed rate loan
A loan where the interest rate is set for an agreed period of time.
Gazumping
A practice where a vendor verbally agrees to a price, but then accepts a later, higher offer.
Gearing
Borrowing money to use to buy investments.
Honeymoon period
A period of time at the start of a loan where an interest rate is applied that is lower than the standard rate.
Interest
The price of money. The price a bank or other lender charges for the money it lends you, or the return you get for the money you lend someone else.
Investment property
A property that the owner does not live in, but rents out.
Mortgage
A contract between the property buyer and the lending institution, that provides property as security for a loan.
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Mortgagee
The party who lends money, and holds a mortgage over the property of the borrower.
Mortgagor
The party who borrows funds, and as security gives the lender the mortgage.
Mortgage duty
A tax levied by a state or territory government on the amount borrowed.
Mortgage insurance
Insurance that protects the mortgage provider against the borrower defaulting on their loan.
Negative gearing
Where an investment is made using borrowed funds, and the income, such as rental or dividend income, after the deduction of expenses, is less than the interest on the borrowed funds in a financial year.
Owner-occupied property
A property the owner lives in as their principal place of residence.
Owners corporation
See ‘body corporate’.
Passed in
A property is 'passed in' at an auction if bidding fails to reach the vendor’s reserve price.
Private treaty sale
The process of selling a property via a real estate agent through private negotiation and contract (rather than by auction).
Redraw facility
A facility on a loan that means you can access (redraw) any additional amounts that you have paid off the loan.
Refinancing
The process of exiting a loan, and arranging a new one with different terms and conditions, or from a different lender.
Reserve price
The price set by the vendor which is the minimum they are prepared to accept at auction.
Settlement
The completion of a property sale, when the purchaser pays the outstanding amount, and legal ownership of the property is transferred.
Stamp duty
A tax levied by a state or territory government on the purchase of property.
Strata title
Under a strata plan, a building and its land is divided into lots. Each of these lots has a strata title as evidence of ownership.
Title search
The process of checking that the seller of a property has the right to transfer ownership, by investigating the title.
Torrens title
The system of dealing with land on which the land laws of all Australian states are based. It is the most common form of property title in Australia.
Variable rate loan
A loan where the interest rate changes in line with market rates.
Vendor
Seller of the property.
Vendor bid A bid made at auction by the seller of the property, usually via the agent acting for the vendor.
Vendor’s statement A document provided by the vendor (seller) to an intending buyer of a property. The vendor’s statement must be provided before the contract is signed. |
