Why Join the REAL ESTATE Adventure (JtA)? YOUR REAL ESTATE GOALS ARE OURS: At our core, we’re not just a real estate service; we’re your dedicated partners in achieving your property aspirations. Your dreams are the compass guiding our every step. From selling or finding the perfect home to maximising property investments, we are committed to making your real estate goals our collective mission for success and fulfillment.

Buying or selling your first home can be a stressful experience. Maybe it’s not your first, but a long time since your last.

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To become acquainted or reacquainted with all the most common jargon used in the real estate industry, we have compiled a little glossary to help you on your buying or selling real estate adventure.

Borrowing Power

Put simply, your borrowing power – or capacity – is the amount of money a lender is willing to loan you.

Getting an indication of how much you can borrow is an important part of the home-buying journey as it provides you with a better indication of what suburbs you should focus your search in and the types of properties you can afford.

Your borrowing power will be calculated based on factors like your income, debt, expenses, savings history and deposit amount, and may differ between lenders.

Comparison Rate

You’ll see this term sitting alongside the interest rate for a home loan.

A comparison rate is a tool that helps you identify the true costs of different home loans. It takes into account the interest charged on the loan as well as certain fees and charges that apply.

Comparison rates may not include all fees and are calculated on a prescribed loan value and term, so it’s important to consider your own circumstances.


A lawyer who specialises in property, a conveyancer will typically be engaged to manage the legal aspects of a property sale.

This can involve reviewing contracts, providing advice to buyers and arranging the details for settlement. A conveyancer can also assist with things like arranging building inspections and reviewing strata reports.

Cooling-off Period

Nothing to do with temperature, a cooling-off period is the length of time a buyer has to change their mind about a property purchase.

This period ranges between two and five business days depending on your state or territory, with the exception of Western Australia, which has no mandated cooling-off period.

It’s important to note that cooling-off periods generally don’t apply to homes sold at auction and that pulling out during this period typically means forfeiting a percentage of your deposit.

Interest Rate

The interest rate on a home loan is the cost you pay to borrow money as a percentage of your loan amount.

You’ll likely come across options for loans with fixed and variable interest rates. As the names suggest, the interest rate on a fixed-rate loan stays the same for a set period, while the interest rate on a variable-rate loan can go up or down depending on the market.


LMI or lender’s mortgage insurance is insurance that a lender takes out to protect itself against the risk of a borrower not repaying their loan.

This cost is typically passed on to you in the form of an upfront fee or an amount added to your loan, to be paid off over time.

Lenders will typically require a borrower to pay LMI if their deposit is less than 20 per cent of the lender-assessed value of the home, which could differ from the sale price.


Pre-approval is conditional approval from a lender that shows you are eligible to apply for a home loan of a certain value.

While it doesn’t guarantee a home loan for that amount, gaining pre-approval can provide peace of mind and show sellers that you’re serious about buying.

On average, it lasts between three to six months. If you need to extend your conditional approval, make sure you speak to your lender before it expires.

Redraw Facility

If you’re looking into home loan options, you’ll likely come across this term.

A redraw facility is a feature that allows you to access additional payments you’ve made towards your home loan.

By making extra repayments and reducing the balance of the loan, you can save on interest. The ability to redraw these extra repayments when needed ensures you can still access those savings.

Reserve Price

While winning at auction means outbidding other would-be buyers, something called a reserve price also comes into play.

Set prior to auction, this is the minimum price that the seller is willing to accept for the home.

If bidders fail to reach this price, the vendor may decide to lower the reserve price or the property will be “passed in” by the auctioneer, meaning it is withdrawn from auction.

Stamp Duty

Also known as transfer duty, stamp duty is a tax paid on property transactions to a state or territory government, and varies across Australia.

The amount paid will be based on the price of the property you are buying, with some states offering stamp duty exemptions or concessions for first-home buyers.

The path to buying your first home can be a complicated yet exciting one. We hope this glossary helps you on your journey.

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