You can use RateCity’s rate tables to compare apples with apples. Using filters, you can enter details of how much you’d like to borrow, your preferred loan term and any other features and benefits you’re interested in. This can help narrow your home loan shortlist down to only those best-suited to your needs.
You can also look at the Real Time Ratings™ on RateCity to get a better idea of each loan’s overall value. These star ratings are calculated as you use the site to help ensure they’re up to date, and combine the cost and flexibility of each mortgage deal.
Choosing a home loan isn't just about picking the lowest interest rate. Remember, the cheapest rate doesn't always mean you're getting the best deal for your situation. There’s no single best home loan that will work for every borrower, but reviewing multiple home loan options and comparing them can increase your chances of finding a loan that’s the best fit for your situation and budget.
Here are some things to consider when comparing home loans:
Interest Rates
Choosing the right interest rate type for your home loan is a crucial decision that can affect your financial flexibility and overall loan costs.
- Fixed vs. Variable: Decide whether you want the predictability of fixed interest rates or the potential savings of variable rates.
- Comparison Rate: Look beyond the headline rate to the comparison rate, which includes the interest rate plus most fees and charges, giving a truer cost of the loan. But remember, this rate is based on a set loan amount and term, so it might not fit your exact situation perfectly. To really understand what you'll pay, calculate your monthly loan repayments and add any fees to see the full picture.
Fees
Buying a property often means paying for more than just the house itself. While your deposit plus your loan amount should cover the property’s purchase price, you’ll also need to have enough money saved to cover other upfront costs, such as:
These costs can vary, and you can use online calculators to estimate how much extra you may need to budget for.
Loan Features
Some of the common and useful home loan features include:
Extra repayments
Additional repayments can help to lower your outstanding mortgage principal, potentially lowering your interest charges and helping you pay off your property sooner.
Redraw facility
Access the extra repayments you’ve previously made onto your home loan, putting the cash back in your bank account when you need it. A redraw facility can be useful if you are paying for renovations, paying for a family holiday or just have an emergency payment you need to make.
Home loan portability
Portability is a home loan feature that allows you to transfer your existing home loan to a new property without the need to refinance. So, if you plan to change homes, you can keep your current loan without going through all the paperwork and processes of getting a new one.
Mortgage holiday
Some lenders allow you to pause repayments on your home loan for a limited time period in the event of financial hardship. This is also known as a mortgage repayment holiday or a mortgage freeze.
Offset account
A 100% offset account is a linked transaction account to your mortgage, in which funds deposited in the account are included when calculating your home loan’s interest charges. The funds help to ‘offset’ or reduce the amount of interest you pay.
