Home Loans

Making sense of the mortgage maze

With so many different lenders and home loan products in the marketplace today, making a decision on the loan that best suits your individual needs can be a challenging task. Listed below is an explanation of the various loan types that may help in your endeavour.

All-In-One Loans

All-in-one loans are everyday transaction accounts where salary and expenses are paid and withdrawn from the loan. The idea here is that by depositing your salary into your loan account and only withdrawing your living expenses as required, is that the interest charges are reduced. The trap with this type of product is that it requires a high level of disciple or borrowers could end up spending more than they should. To realise the same benefit whilst minimising the overspending risks.....we recommend a variable rate product with a 100% offset facility.

Basic Variable Rate Loans

Basic variable rate loans are extremely popular due to their low interest rates. The trade-off with these types of products is that they are limited on features.

Construction Loans

For those building a home or renovating an existing home, we can arrange a construction loan.

Discount & Introductory Home Loans

These loans offer a no frills home loan on a lower/discounted rate, with fewer features. Most come with penalties for discharging the loan in years 1, 2 or 3.

Equity Loans or Lines of Credit

Equity loans or lines of credit allow borrowers to unlock the equity in their properties for any worthwhile purpose such as renovating, investing, motor vehicles, children's education, etc. These types of products provide a low cost option to other forms of personal lending with the flexibility of allowing interest to capitalise.

Fixed Rate Loans

Fixed rate loans protect borrowers against interest rate rises for a given period of time although they work against borrowers when rates fall. Fixed rate loans are popular amongst investors and home owners that require a level of security when forward planning their repayments.

Low Doc Loans

Low doc loans are a great solution where borrowers can afford the loan repayments but are unable to disclose full income details. Low doc loans are popular amongst self-employed applicants or where they have an irregular income stream.

Non-Conforming Loans

Non-conforming loans are designed to benefit borrowers who do not meet mainstream lenders' criterion. These types of loans are the perfect solution where a borrowers' credit history may have been impaired due to a one-off situation such as divorce, failed business, illness, or temporary unemployment.

Offset Loans

An offset account is a transaction account that can be linked to your home or investment loan. The credit balance of your transaction account is offset daily against your outstanding loan balance, reducing the interest payable on that loan.

Professional Home Loan Packages

A professional package offers you a range of discounts depending on the size of your loan. The features of a Pro-Pac include discounts off the standard variable rate, fee free transaction account, credit card with no annual fee. The main benefit of these packages is that you can have numerous loans with the discounts and only pay the one annual fee.

Reverse Mortgage

A Reverse Mortgage allows you to borrow money using the equity in your home as security. The loan can be taken as a lump sum, a regular income stream, a line of credit or a combination of these options.
While no income is required to qualify, credit providers are required by law to lend you money responsibly so not everyone will be able to obtain this type of loan.
Interest is charged like any other loan, except you don’t have to make repayments while you live in your home – the interest compounds over time and is added to your loan balance. You remain the owner of your house and can stay in it for as long as you want.
You must repay the loan in full (including interest and fees) when you sell your home or die or, in most cases, if you move into aged care.
The older you are the more you can borrow. As a general guide, if you are 60 the maximum amount you can borrow is likely to be 15-20% of the value of your home. You can usually add 1% for each year older than 60. (Extracted from ASIC website).

Split Loans (Combination Fixed/Variable)

Combination or blended loans allow borrowers to split their home loan into partly fixed and variable portions. This provides borrowers with the flexibility of a variable rate product and added certainty of a fixed rate loan.

Standard Variable Rate Loans

Standard variable rate loans are known for their flexibility and features. Partly fixing, loan splits, offset, additional repayments and redraw are usually standard with this type of product.