Check here to compare interest rates on a range of home loans
| Basic home loans What is a basic home loan? Compare interest rates. |
Standard variable home loans What is a standard variable home loan? Compare interest rates. |
| Variable Honeymoon loans What is a variable honeymoon loan? Compare interest rates. |
Fixed Honeymoon loans What are honeymoon loans with a fixed period. Compare interest rates. |
| Offset Account Loans What is an offset loan? |
Home equity or Line of credit loans What is a line of credit loan? Compare interest rates |
| Standard 1 year fixed What are fixed rate loans. Compare interest rates. |
Standard 2 years fixed What are fixed rate loans? Compare interest rates. |
| Standard 3 years fixed What are fixed rates? Compare interest rates. |
Standard 5 year fixed What are fixed rates? Compare interest rates. |
Knowing the nature of interest rates is important in dealing with home loans. Whether you are buying a home for the first time or refinancing, you need to figure out what sort of home loan interest rate suits you.
More borrowers prefer the Standard Variable Interest Rate home loan option. However, as the market interest rate that is determined by the Reserve Bank of Australia rises, the standard variable interest rate rises too. Therefore, repayments for a variable home loan interest rate may vary.
On the other hand, variable interest rates have a number of advantages. First, a variable interest rate is lower than a fixed one at the start of the loan deal. Also, your home loan will decrease if the market interest rate decreases too.
Meanwhile, fixed home loan interest rates stay the same during the loan term no matter what happens with the market interest rate. This can give you a sense of security since you always know the exact amount of your loan repayment.
On the other hand, fixed interest rates have a premium as compared to the variable one. Home loan lenders charge for this fee as a privilege for future use. Also, the interest rate will not change even though the market interest rate decreases.
Due to all the reasons stated above, more loaners prefer the variable interest home loan due to the fluctuating interest rates. But this doesn’t mean that it is the best among the two. To have a better understanding about the suitable home loan deal for you, it is best to have a pre-calculation first.
