FIRST HOME BUYER
As a First Home Buyer, there are some special considerations available to you. These vary from State to State and Lender to Lender. You have the same options as other borrowers, plus some benefits like First Home Owners Grant (FHOG), Exemption from Stamp Duty (restricted levels apply), REBA Grant assistance with Fees (Qualifying conditions apply) and there are also Lenders that do not charge Lenders Mortgage Insurance for Low Deposit home loans.
PRINCIPAL and INTEREST
This type of loan is where each repayment is comprised of interest plus a reduced amount of the loan principal.
INTEREST ONLY
This type of loan requires repayments to be only the interest component with no reduction in principal. These are usually only used in investment situations.
VARIABLE RATE
This is an interest rate that will generally vary in line with changes to official interest rates.
FIXED RATE
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.
REDRAW
This loan feature lets you withdraw any additional repayments you have made on your home loan. This is a handy way to reduce your interest while providing access to your funds. Each lender has their own criteria for this option.
OFFSET
This is a savings account that is linked to your loan account. With an offset loan every dollar in your savings account is credited against your home loan. Every day that you have money in your savings account saves you interest on your home loan.
PORTABILITY
This is the ability to move your home loan as you move homes. It’s convenient because you save the time and trouble of establishing a new loan and save on fees and other costs.
INVESTMENT LOAN
Investment loans are structured in a specific way that allows you to make the most of your assets! An investment plan is one that works towards building your wealth and securing your financial freedom. For some, the future may seem a long way off, but the time to act is now because the future waits for no one. The housing market is generally a seven to ten year cycle: there are always highs, lows and steady patches.
HONEYMOON LOAN
A loan with lower repayments for the first six to twelve months. After the ‘honeymoon’ the loan becomes a standard variable loan and the repayments increase. Make sure that you can meet the higher repayments for the remainder of the loan. You could also be faced with a fee at the end of the honeymoon period to switch to another loan type.
ADDITIONAL REPAYMENTS
Additional repayments are not only permitted without penalty but encouraged, with features such as Direct Salary Crediting and Redraw. The affect of additional payments can be seen using our Extra Cash Calculator.
