Compare mortgage offers with Savvy to help you find the very cheapest and best home loan for your individual needs.
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With so many home loans on offer in Australia today, it can seem like a challenge to narrow down your options to find the best one for you. Fortunately, comparing the best home loans is simple when you do it with Savvy.
Read on to find out what home loan features are available and which ones you should take into consideration when comparing home loans. Compare the best Australian home loans side by side with Savvy to help you make an informed choice about which loan is best for you and your family
First homebuyers
If you’re a first homebuyer, the chances are you don’t have a large deposit, so you may want to compare loans which offer the opportunity to have less than the ‘standard’ . Some first homebuyer loans also offer very low interest rates fixed for a set number of years, before reverting to a standard variable interest rate. These ‘introductory’ or ‘honeymoon’ loans may be your best option for the first one to five years if you don’t have a large deposit, which can help you save up more money during that period.
Other incentives for first homebuyers include cashback offers, which can assist with the cost of stamp duty or Lenders Mortgage Insurance (LMI) and loans with no application or ongoing fees.
Owner-builders
If you’re thinking of building a house, there are owner-builder mortgages available which may offer you the best home loan solution. Construction loans are often interest-only (IO) fixed-rate loans which allow you to pay your builder in stages as building milestones are met, rather than manage a lump sum from the beginning. These construction loans often have the best interest-only fixed mortgage rates during the construction phase, before reverting to a variable, principal and interest rate loan when building is complete.
Refinancing
The best home loan for you if you’re refinancing is likely one that offers a low interest rate plus lots of additional features to help you pay your loan off sooner. This could either be a lower fixed or variable interest rate, or you may consider a split rate, which divides your loan into two parts: one on a fixed rate for a set number of years, and the other with a variable rate which will offer you more flexibility to pay off your loan sooner. Features may include an offset account, the ability to make unlimited additional repayments and the option to pay your loan off completely without any loan break fees.
Property investors
The best loan for property investors will depend on the state of your property and what you intend to do with it. If it’s untenanted and you intend to renovate or redecorate before renting it out, you may want an investment property loan on which you only pay the interest portion until you start receiving rental income. An interest-only short-term fixed rate loan may be your best option in these circumstances, as well as if you’re looking to sell within the next few years.
If you already have tenants and wish to negatively gear your property but pay your loan off in the shortest possible time, a standard investment variable rate loan with an offset account, redraw facility and the option to make lump sum repayments may be the best option for your particular circumstances.
As a general rule, you’ll be offered the best and lowest home loan interest rate if you present as a low-risk borrower. Some of the methods you can use to show a lender that you’re a low-risk borrower include:
The type of property you buy and its location will also impact the interest rate you’re offered, with lenders more willing to offer lower interest rates to borrowers in metro areas who are buying properties that would be easy to re-sell. For instance, apartments and townhouses come under the strata title ownership model, whereby the buyer owns both their individual lot and a share of the common property (such as an apartment building, driveway or garden area), often making them more difficult to sell than standalone homes.
These are some of the questions you should ask yourself when considering which is the best home loan for your needs:
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The bigger your deposit, the less you need to borrow, and the less interest you’ll pay. Lenders offer better rates to people with larger deposits. With a 20% deposit, you’ll avoid paying costly LMI.
Choosing a home loan is one of the biggest financial decisions you’ll ever make, so ensure you do your homework and compare different mortgages to make sure you find the best home loan for your circumstances.
Although some of the loan features on offer are very attractive, carefully consider whether you really need a loan feature before paying extra for it.
If maths is not your strong point, use Savvy’s handy range of calculators to find the answers to many of your home loan financial questions. These can help calculate your loan repayments based on a set loan term or repayment budget.
Home loans usually take decades to pay off, so plenty can change over that time. Make sure when you’re figuring out what you can afford to repay that you leave room in your budget to cater for life’s speedbumps and unexpected expenses.
The better your credit rating, the more likely lenders are to offer you their best interest rate. You’re entitled to a free credit check each year, so get a copy of your credit report before you apply for your loan and make sure there are no mistakes in it.
The home loan market is constantly changing, so it’s a good idea to check for better deals regularly. Refinancing to get the cheapest home loan rate, either with your existing lender or another, can save you thousands in interest over the years.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
