FIRST HOME BUYER GUIDE

The First Home Owner Grant is a tax-free grant available to home buyers who have never owned a property before. Only one grant is payable per property - even when the home is purchased in joint names.

To be eligible you must meet the following criteria:

• One applicant must be an Australia citizen or a permanent Australian resident
• You must be at least 18 years old
• You have never owned a property or received the grant before. This includes any co-owners you purchase the property with
• You will need to use your home as your principal place of residence for at least six months within the first year of settlement.

Your Citibank Mortgage Specialist can organise the First Home Owner Grant for you - so the funds will be available at settlement.

First home buyers may be eligible for stamp duty concessions, which can save them thousands of dollars.

• Calculate your stamp duty

For further information on stamp duty, go to your state or territory's website for the stamp duty in your area, or search online at www.firsthome.gov.au

Begin by telling us what you're looking for, and we'll show you the best loans we have for you. Then just send us your details and one of our mortgage specialists will look after you from there. Alternatively, you can view our entire range of loans. And at any stage, you can click though and arrange for one of our mortgage specialists to do the rest.

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A rate that includes upfront and ongoing fees as well as the advertised interest rate. It will assist you in identifying the true cost of a loan.

A credit limit increase allows you to borrow additional money using your property. This can be done via an increase to an existing account or by the set up of a new account.

The difference between the amount owed on your home loan and your home's value.

Allows you to use extra cash to reduce the outstanding principal and interest on your home loan. This is a great way to pay off your loan faster.

An interest rate that allows you to lock in to a specified rate of interest, with fixed monthly repayments, for a given period of time.

A type of loan that requires payments of interest only and, as such, leaves the loan principal the same.

If you borrow more than 80% of the value of the property you're buying, you will need to pay Lenders Mortgage Insurance (LMI). This insures your lender (not you, the borrower) against non-payment or default. By protecting your lender against default, LMI allows you to borrow with lower deposits. Your lender will organise LMI on your behalf, so it's not something you need to shop around for.

The LMI premium you can expect to pay will be based on the size of your mortgage and the purchase price. One of the best ways to reduce the cost of LMI is to save a larger deposit. However, this is not always possible, and to make the premiums more manageable some lenders - like Citibank - let you add LMI to the value of your loan. This is called 'capitalising' the premium, and it lets you pay the LMI bill over the loan term rather than adding it to your other upfront expenses.

The LVR refers to the size of your home loan expressed as a percentage of your property's value. For example, if you borrow $300,000 to fund a property worth $375,000, the loan is said to have an LVR of 80% ($300,000 is 80% of $375,000).

Your home loan deposit is usually 20% of the purchase price. But to help you get into your new home sooner, many lenders now approve loans with lower deposits.²

Citibank's Low Deposit Home Loan is the ideal solution for getting into your own home sooner. It helps you escape the rent trap and start building wealth in your home. Suitable for customers with strong incomes but limited savings to support their loan, Citibank's Low Deposit Home Loan is available with our Basic, Standard Variable, 100% Offset and Fixed rate loans.² Your Citibank Mortgage Specialist can provide further details.

Many lenders offer an 'offset' account, which is a savings account linked to your home loan. It can be a great way to save on interest costs because interest charged on the home loan is calculated on the difference between the balance of your loan amount owing and the balance in your savings account.

Let's say, for example, that the balance on your home loan is $250,000, and you have $10,000 in your savings offset account. Instead of being charged interest on the full value of your home loan, interest will be charged on a balance of $240,000 - being the difference between the balance of your loan and the money in your offset account.

A Citibank Offset Savings Account can be combined with our Standard Variable loan to get the best of both worlds - day-to-day access to your money while paying off your mortgage sooner.

Enables you to keep an existing loan should you wish to sell your property and buy a new one - a real plus in terms of cost savings and convenience.

This refers to the repayment of principal and accrued interest to clear your loan within a defined period of time, usually no more than 30 years.

The sale of property subject to privately negotiated terms (as distinct from a sale at auction).

This popular loan feature lets you withdraw any additional repayments you have made on your mortgage. It is a useful way to reduce your interest while providing access to your funds. Citibank offers free redraws on all of our variable interest rate home loans.

Changing your loan product. For example you could change from a fixed rate to a variable rate, or change from one type of loan to another type of loan, depending on your needs.

Having multiple loan accounts. This means you could have multiple variable rate loans, multiple fixed rate loans, both variable and fixed rate loans, or any combination of up to four different types of loans, including revolving lines of credit.

An interest rate that can vary and changes when the bank varies the rate. For example, when the cash rate changes.