Compare Home Loan rates from 4.99% – Page 14

Refinance home loans are for those seeking to change their existing home loan in some way - whether that’s to secure a lower interest rate, move to a loan with better features, access equity, etc.

Investment home loans are for property investors looking to purchase property with the intention of generating rental income and/or capital growth. Investors can also refinance their existing investment home loan from one to another

Interest-only home loans are for those that wish to have temporarily lower loan payments by putting a pause on their repayment of the loan’s principal (i.e. the borrowed amount) for a set period of time. During this time (typically three to five years) only the loan’s interest charges are paid.

Construction home loans are suitable for those building a new home or doing large-scale renovations of their existing home. These loans operate quite differently to regular home loans, with the loan typically released in stages to align with the various phases of construction and often have interest-only repayments during the build.

A green home loan is like a regular home loan, except it features a discounted interest rate for properties that meet certain energy efficiency standards. There are several lenders in Australia that offer green home loans with these discounted rates, but eligibility criteria can vary.

Many lenders in Australia offer home loans at amounts up to 95% the value of a property. These are known as 95% LVR home loans, or simply low deposit home loans, and they are designed to cater for borrowers wishing to purchase a home with a 5% deposit.

Low doc home loans (short for low documentation home loans) are primarily for self-employed workers that lack the comprehensive proof of income that salaried employees often have. Hence the 'low doc' name. Several lenders in Australia cater for these types of borrowers, albeit at higher interest rates.

Many Australian borrowers value an offset account, or offset sub-account, on their home loan, because any funds stored in these accounts effectively reduce the interest-accruing balance of the home loan while remaining entirely accessible - as if the funds were stored in a regular transaction account. This can generate big interest savings while offering the peace of mind that the money can be accessed when needed.

Some lenders allow borrowers to have a guarantor to help them secure loan approval, often without the need for lenders mortgage insurance. Guarantors (typically a parent or guardian of the borrower) essentially promise to take on the responsibility for repaying the loan should the primary borrower fail, and may need to offer equity in their own home up as collateral.

Bridging loans are for borrowers seeking to finance the purchase of their next home before they’ve sold their existing one. The bridging loan essentially covers (i.e. bridges) the financial gap that exists between the purchase of the new property and the sale of the existing property.

SMSF loans are for self-managed super fund trustees purchasing an investment property for the benefit of the fund. Unlike regular home loans, SMSF loans operate under a limited-recourse borrowing arrangement (LRBA), which generally means that in the event of a default the lender can only repossess the asset the loan is being used to purchase i.e. the investment property, as opposed to all the other assets within the fund. There are a handful of lenders in Australia that currently offer SMSF loans.

As the name suggests, reverse mortgages are essentially the reverse of a normal mortgage. Instead of borrowing money to buy a home and build equity in it over time, reverse mortgages allow those that already own their home outright to reduce their equity in it in exchange for borrowed funds. These products are generally restricted to Australians aged 65 and over.