Loan Features Videos
Valuations of your property generally need to be done when you are applying to get finance. This is either completed upfront before the loan process starts, or ordered through the lender as the loan is progressing through; it depends on your individual circumstances.
Pros and Cons of Fixing
- If you pay out your loan for any reason during your fixed contract, you may incur break costs
- You are restricted from lender to lender on how much extra you can pay off your loan without incurring break costs
- If rates go down, your rate will not go down as you are fixed
- You are unable to offset a fixed rate loan with some banks
- You know exactly what your repayments will be during your fixed period
Line of Credit and Equity Loans
An Equity Loan/Line of Credit is an interest only facility that has a pre-determined limit. It can be used for investment purposes or personal purposes. You draw down what you need when you need it and only pay interest on whatever the balance is at the end of the month. This facility gives you flexibility however is at a slightly higher rate than a normal home loan.
Family Equity & Parental Support is generally used to help first home buyers looking to get into the property market.
Lenders Mortgage Insurance
Lenders Mortgage Insurance is a product that protects the bank should you default on your loan. Lenders mortgage is required if you don’t have a 20% deposit. In most cases this can be added to the loan so its not an added expense.
Basic Products vs. Professional Packages
- Basic Product – Base Variable loan product, application fee, monthly service fee, no offset feature, redraw available usually at a fee
- Professional Package – Variable, Fixed, Line of Credit & Split Loan products available, annual package fee, bank account with offset feature, redraw available usually fee free