Below is a table of loan features that are available that might have benefits that are suitable for your needs.
| FEATURE |
DESCRIPTION |
BENEFIT |
FOR PEOPLE WHO WANT TO.. |
Offset Facility |
A savings account linked to your mortgage, so that the interest earned on your savings is applied to offset the interest charged on your mortgage. |
Saves interest on your loan. |
Save interest and pay their loan off sooner. |
Redraw Facility |
Allows you to redraw any funds that you have repaid in excess of the scheduled repayments. |
A flexible way to gain access to extra repayments. Also saves interest whilst the extra funds are sitting in the loan. |
Have easy access to extra repayments that have been made. |
Loan Portability / Security Substitution |
Substitute security properties whilst keeping the same loan |
Saves the time and expense of having to apply for a new loan. Can be a good way to avoid break costs on an existing fixed rate loan when selling an existing property. |
Have the convenience of buying and selling property without having to re-apply for new loans each time. |
Extra Repayments |
The ability to pay extra funds into your loan account. |
Saves interest by reducing the loan balance. |
Use surplus income to maximise the interest saving on your loan. |
Switch to Fixed Rate |
Change an existing loan to a fixed rate during the loan term. |
Safeguard you against potential interest rate increases. |
Have the option to select a fixed rate at a later stage. |
Split Facility |
Choose to split the loan into fixed or variable portions, or a combination of other allowed products. |
Allows you to have a number of sub-accounts to take advantage of fixed interest rates or other special features. |
Have the benefits of a number of product features, and flexible management of multiple loans. |
Interest Only Repayments |
The lender only requires repayments to cover the accrued interest on the loan. Terms of between 1 - 5 years are most common, with the loan converting to principal & interest repayments at the end of the interest only term. |
Minimises the required repayment on the loan. |
Pay the minimum required amount off the loan. Also for those who do not have an immediate requirement to reduce the principal debt amount - in particular, property investors. |
Principal & Interest Repayments |
Pays not only the interest charges on the loan, but also an amount of money that will actually repay the loan in a given time period. Known as amortisation. |
Reduces the debt outstanding over time. |
Increase your equity in the property, and ultimately repay the debt in full. |
Fixed Rate |
Interest rate is 'locked in' for an initial term of usually between 1 - 10 years. Will then revert to standard variable rates at the expiry of the fixed term. |
Gives you repayment certainty.
**Break costs can apply when making extra repayments or clearing the loan in full during the fixed rate period. |
Have repayment stability, or safeguard themselves against future interest rate rises. |
Lenders Mortgage Insurance |
Insurance protecting the Lender against any financial loss that might result if it becomes necessary to sell the mortgaged property as a result of the borrower's default. Usually only paid by the borrower if borrowing more than 80% of the value of the property. |
Borrowers can maximise their borrowing potential, by having a lesser equity contribution. |
Purchase a property by contributing a lesser deposit. |
First Home Owners Grant |
Government grant of $7,000 made to first home buyers, who have never owned property before. |
Assists borrowers with the costs associated with purchasing their first home. |
Purchase their first property. |
