FAQs
Vendor finance has been in existence since the early 1900s.
If you borrow money from the bank to buy a home then you are using "Bank Finance". Vendor finance is simply the owner of the home lending you the money so you can buy the home.
Our customers are people who can't qualify for a home loan at present. There are many reason why the bank has said no. Below are some of the most common reasons:
Don’t have a big enough deposit.
Have a credit problem.
Have not been long enough in their current employment.
Have not lived at the current address long enough.
New Migrants.
Stepping Stone Property Investments purchase houses especially to sell on Vendor’s Terms. You the purchaser make payments to Stepping Stone Property Investments until you are able to go to a bank and qualify for a home loan. The contract is set up over a set period of years and you are able to refinance the property at any time you choose. We encourage our purchasers to refinance as soon as they are able to do so.
When we sell a house to you, you will receive a Contract of Sale that includes additional information about your loan repayments. The price of the home is fixed at the time of purchase and cannot be altered. We will provide you with regular statements showing your payment history, which may assist you in refinancing with another lender.
Your loan will have a variable interest rate. Your payments will go up if bank interest rates rise and your payments will go down if bank interest rates fall.
To apply for a home, you will need at least one income between all applicants. Our approval process is extremely simple. An application form will be emailed through to you on request.
As soon as are able to qualify with a bank or other lender you should do so. We are a stepping stone from no home to getting into the regular banking system.
The title will also transfer into your name when you refinance.
Before you can get your own loan you will need to build up your equity in the home.
There are three ways to increase your equity. You have control over two of them.
Make additional payments.
Make improvements to the house.
Wait for the house to go up in value all by itself.
The deposit may vary from home to home. The minimum deposit is $ 10,000. The First Home Owners Grant will apply. If you do not qualify for the grant then your deposit will depend on your income. We can discuss this when you make contact with us.
The only other fee involved is $ 1 400.00. This is paid when you give us your application. The $ 1 400.00 is used to prepare the documents for you to purchase of the house from Stepping Stone Property Investments and is not refundable once the documentation is prepared. If your application is not successful the $ 1200.00 is refunded.
The deposit is payable before you move in.
If you, or your partner have never owned a home before then you may be eligible for the grant. We will provide you with the application if you meet the criteria for the grant.
Your repayments may be principal and interest or interest only. The amount of your repayments is in your contract and will be explained to you in full. All repayments are to be made according to the contract. This is either weekly, fortnightly or monthly. This is usually decided depending on when you get paid. Your payment is made up of your loan repayment and a weekly allowance to cover rates and insurance. At the moment this allowance is about $35 a week.
You are responsible for the payment of Building Insurance, Water and Council rates. They are paid by Stepping Stone Property Investments out of the $35 per week allowance that you pay with your repayment.
We only accept repayments by weekly Direct Debit to Stepping Stone Propert Investments
Extra payments can be made at any time and will help build equity in your home.
You can’t decrease your payments below the minimum required, and your loan has no redraw facility, so you shouldn’t make extra payments if you are likely to want them back.
If for some reason you are unable to make your payments, contact us immediately to discuss the matter. It is essential that you maintain contact with us if there are genuine reasons for late payment. Situations cannot be resolved unless you communicate with us.
Your contract can be cancelled if you are in arrears by a certain amount and you don’t pay the outstanding amount within a given time. The legal process for non-payment is detailed in the contract of sale.
We encourage you to seek independent legal advice to ensure that you understand your contract. Conveyancing is only required when you refinance or pay out your loan.
If you require further information, please do not hesitate to contact us.