When a Home Loan is not just a Home Loan.
- By andrewson Samuels
- Published 10/1/2009
- Business
- Unrated
So, which home loan should you choose? Take a look at each home loan type and find the one that matches your needs.
Fixed Rate Home Loans
Rates and repayments on a fixed rate mortgage are fixed over a specified period which makes budgeting simple. If rates rise you benefit but if rates fall, you will miss out on the lower rate. Additional repayments may be restricted or not permitted depending on the loan conditions.
Variable Rate Home Loans
Standard variable home loans usually offer lower interest rates than a fixed rate loan. But, as the rate is variable, this means that your repayments can go up or down depending upon interest rates. Basic variable rate loans offer even lower rates than a standard variable but come with less features.
Split Rate Home Loans
With this type of loan, you nominate how much of your home loan you would like to be secured with a fixed mortgage interest rate and how much of your home loan (the remaining amount) you would like to put on a variable rate. Splitting your Sydney Home Loan is a cautious way of borrowing.
Construction Loans
Construction Loans are designed to help those who wish to design and build their own home, or make major renovations to an existing property.
Usually you take only what you need at various stages of the construction, and you only pay interest on the amount drawn so far.
Bridging Loan
No matter how organised you are, sometimes circumstances prevent you from selling one property before purchasing another. In these circumstances bridging finance can be particularly useful. With a bridging loan, your lender will loan you the money to cover the gap between settlement and purchase.
Pro pack loan
Professional package loans are tailor made for the business owner or the professional investor, as the loans are often bundled with other features.
Low doc or No doc home loan
Low doc mortgages are traditionally for borrowers who are unable to provide sufficient evidence of income, such as self employed workers. The loan allows you to get finance without the need to show the same documentation as a regular Sydney home loan would require. Instead, you sign a self declaration of your income.
Honeymoon Loan
Introductory or “honeymoon” home loans provide you with a small discount off the standard variable interest rate at the beginning of the loan. After the period has finished, your home loan generally reverts to a standard variable interest rate, unless you have negotiated something different with your lender, and this rate can be considerably higher so it pays to check this out at the start.
Fixed Rate Home Loans
Rates and repayments on a fixed rate mortgage are fixed over a specified period which makes budgeting simple. If rates rise you benefit but if rates fall, you will miss out on the lower rate. Additional repayments may be restricted or not permitted depending on the loan conditions.
Variable Rate Home Loans
Standard variable home loans usually offer lower interest rates than a fixed rate loan. But, as the rate is variable, this means that your repayments can go up or down depending upon interest rates. Basic variable rate loans offer even lower rates than a standard variable but come with less features.
Split Rate Home Loans
With this type of loan, you nominate how much of your home loan you would like to be secured with a fixed mortgage interest rate and how much of your home loan (the remaining amount) you would like to put on a variable rate. Splitting your Sydney Home Loan is a cautious way of borrowing.
Construction Loans
Construction Loans are designed to help those who wish to design and build their own home, or make major renovations to an existing property.
Bridging Loan
No matter how organised you are, sometimes circumstances prevent you from selling one property before purchasing another. In these circumstances bridging finance can be particularly useful. With a bridging loan, your lender will loan you the money to cover the gap between settlement and purchase.
Pro pack loan
Professional package loans are tailor made for the business owner or the professional investor, as the loans are often bundled with other features.
Low doc or No doc home loan
Low doc mortgages are traditionally for borrowers who are unable to provide sufficient evidence of income, such as self employed workers. The loan allows you to get finance without the need to show the same documentation as a regular Sydney home loan would require. Instead, you sign a self declaration of your income.
Honeymoon Loan
Introductory or “honeymoon” home loans provide you with a small discount off the standard variable interest rate at the beginning of the loan. After the period has finished, your home loan generally reverts to a standard variable interest rate, unless you have negotiated something different with your lender, and this rate can be considerably higher so it pays to check this out at the start.