Home loan savings
Depending on your particular home loan needs, you could be making significant savings off your home loan rate just by choosing a smarter home loan for your situation.
Having a good mortgage adviser to negotiate your loan terms and conditions on your behalf could possibly save hundreds off your home loan. This could amount to thousands of dollars in repayments each year and tens of thousands of dollars in interest over the life of your home loan.
Introductory or honeymoon home loan rate
A good introductory/honeymoon home loan rate that reverts to a competitive standard variable home loan rate after the introductory period is over can be a good way of making some savings, particularly in the early part of your home loan. Be aware that an introductory or honeymoon rate home loan may come with higher early repayment or exit fees, higher establishment and ongoing fees, and limited extra repayment options in the introductory period than a standard variable rate home loan.
Fixed home loan rate
A fixed home loan rate, either for the entire loan amount or just a portion to suit your financial goals and situation, can potentially save you money, particularly if variable home loan interest rates rise during the fixed term period. Flexibility and additional home loan features can be limited, but there may also be a fixed home loan rate special offer available that offers either an interest rate discount or some additional flexibility.
Basic variable home loan rate
Basic variable home loan rates can be a very economical home loan choice, offering some substantial discounts off the standard variable home loan rate. This is because most basic variable home loan rates have fewer features than their standard variable counterparts.
Limited guarantor home loans – family equity home loans
Strictly speaking, this type of home loan will not lower your interest rate, but a limited guarantor loan, where a relative – usually your parents – contributes money towards either your deposit or ongoing home loan repayments, may help you save money by lowering the amount you borrow and reducing or removing the need to cover Lenders Mortgage Insurance. Read more about family equity loans.
A professional package may give you a substantial discount off the standard variable home loan rate, depending on the size of your home loan. Professional packages work by bundling your home loan with a savings account and credit card, or similar financial products, and charging a single yearly package fee rather than separate credit card and account keeping fees on each individual product. Professional packages are generally offered based on the size of your home loan – the larger your home loan the greater the discount you may be eligible for.
Larger home loans
The bigger your home loan, the more likely you are to be able to negotiate lower interest rates and more loan flexibility to save you money. A better home loan deal is more likely when you are seen as an attractive customer. Things like how much you are planning to borrow, the size of your deposit, and whether or not you can bring other loans into the fold (for other properties or assets) will all have an effect. If you’re refinancing and are happy to take all or some of your business elsewhere, this can also be very useful.