Home loan jargon

Man 1: OK, let's have a look at the material for the next ANZ podcast.

Man 2: Sure, what's the topic?

Man 1: Mortgage jargon.

Man 2: Mortgage jargon. What do they mean?

Man 1: Let's have a look. Ah, here we are. Mortgage - a document that provides property as security to a lender for payment of a debt. Establishment fees - fees that a lender charges to set up a home loan. Vendor - the person selling the home.

Man 2: They can't be serious. We can't make a podcast out of that. Give them a call and tell them to make a brochure out of this list, not a podcast.

Man 1: They already have a brochure. They want a podcast.

Man 2: Right. Is there anything more juicy in that list?

Man 1: There's Cooling Off Period - some States have a cooling-off period following the exchange of contracts in a private sale during which time the buyer is legally entitled to withdraw.

Man 2: No

Man 1: Equity-the market value of a property less what you owe on it.

Man 2: Stop now. This is not going to work.

Man 1: What about if we set up an interview with a home loan expert from the bank and then ask them questions…You know. So Geoff, what is an Interest Only Loan? Well, Tony, it's a loan in which only repayments on the interest are made, not principal and interest. And how does it compare to a Line of Credit? Well, that's an amount of money that you borrow on which you only pay interest when the credit is accessed.

Man 2: That's your idea? This is a podcast not a workplace training video. It's supposed to be entertaining.

Man 1: Well that might be entertaining if you are looking at buying a house. I wish I'd known what a Fixed Rate Loan was when I bought my house. Listen to this - a loan with an interest rate that remains constant for an agreed period.

Man 2: So what? It's not about you and your home loan. We're trying to write a podcast.

Man 1: Yeah but I was just saying that it could be interesting… Man 2: Ok, find me one interesting thing on that list.

Man 1: Negative Gearing. Everyone's talking about that-when the income from an investment property is less than the cost of the interest on the loan. In some cases it offers tax benefits. That's great.

Man 2: No, that's boring. You're delusional.

Man 1: I know. I've got it. We can interview a home loan.

Man 2: What?

Man 1: We can interview er …Harry the home loan. He can explain the jargon. A Variable Interest Rate Loan has an interest rate that varies in accordance with the marketplace.

Man 2: Lame.

Man 1: What?

Man 2: That is the lamest thing I have ever heard. Next you're going to suggest robots. Off The Plan Purchase is buying a property from the plans before it is completed. Lenders Mortgage Insurance is a policy that insures the lender against the borrower defaulting on a loan. Does not compute. Does not compute. Exterminate.

Man 1: Yeah, well I don't hear any constructive ideas coming from you.

Man 2: That's because it can't be done. You cannot make a podcast out of this stuff. It's absurd.

Man 1: Well we have to.

Man 2: OK. How about this? We set up a story that starts with a couple buying a house. They ask their home lender about it? You know, What's conveyancing? That's the process by which the title of the property is transferred. What about Settlement? That's when final payments are made on a property purchase and its possession changes hands.

Man 1: And then?

Man 2: Oh, I don't know. It's hardly inspiring material, is it? It just proves hat I've been saying. You can't make a podcast out of a list of jargon.

Man 1: Shall I call ANZ.

Man 2: Yeah, call them. Tell them it can't be done.

If you're interested in finding out more information, talk to ANZ's dedicated mortgage experts on 1800 035 500, 8am to 11pm (AEST), seven days a week, drop into your local branch or we can come to you.