Links
We provide...
- Residential loans
- Commercial loans
- Construction loans
- Business loans
- Leasing and equipment loans
- Personal and Car loans
- Deposit bonds
- Short term finance
- Accounts / Bookkeeping
- Insurance
- Legal
- Financial Planning
Loan Types
Standard Variable loan
Standard variable loans are the most popular home loan type in Australia. The interest rate on this loan moves up and down in line with official interest rate fluctuations. This means the interest rate may go way up or down during the loan term. Different lenders offer different features and rates on their standard variable loan products, generally according to the amount you are borrowing. Right now you can get a range of discounts off standard variable rates if you are borrowing $150,000 or over. This discount can range anywhere from .5-.7% or even higher (usually for amounts greater than one million).
Basic variable loans are loans with lower interest rates, but with fewer features than a standard variable loan. The interest rate can rise or fall over the term of the loan. These loans are typically “no frills” products although there are more features being added by some lenders as the market becomes more competitive.
Discount Variable, Honeymoon, Introductory Loans
These are variable rate loans with a discounted interest rate off the standard variable rate (commonly over 1%), lasting a certain period of time, usually one year. After this period, they normally revert back to standard variable rates. Sometimes, depending on the lender, rates can be fixed or capped during the initial/honeymoon period.
Fixed-rate loans are where the borrower’s interest rate and repayments are fixed for a set period, usually from one to ten years, and sometimes longer. These loans commonly revert to the standard variable rate at the time the fixed-rate period has expired, unless “rolled over” for another fixed-rate term (at prevailing fixed rats).
Split loans allow borrowers to take part of their loan s a variable rate loan and the other part as a fixed-rate loan (split however you like). While the overall loan amount is considered “a total”, each part is treated separately for loan contract purposes.
Line of credit or equity loans allow borrowers to borrow up to a specified limit which is secured by a registered mortgage over a residential property. These loans provide access to funds, when required, up to the original limit set. Normally, the minimum repayment required is the monthly interest only. Some lenders require that principal reductions begin to be made after a certain period of time. These loans can be used for pretty much everything. They are a creative way to generate funds for investment purposes, finding businesses, other properties, loans to children to help them buy property, etc.
Low-Documentation or No-Documentation Loans
Low or no-documentation loans are exactly what they describe. These loans require very little or no documentation to get approval. They are typically used by borrowers who are self-employed or do not have tax returns or financial reports.
Specialist lenders offer non-confirming loans to people who don’t meet the bank’s strict lending criteria including older borrowers (over 55) for whom a 25-year loan may not be appropriate because they are close to retirement; people with a bad credit history, perhaps with a history of late repayments, loan default or possibly even formerly bankrupt, new migrants with no borrowing record, seasonal, casual or self-employed workers.
Normally you have to save at least a 5% deposit plus costs before applying for a loan. With the no-deposit loan, you can borrow 100% of the purchase price. Some lenders go as high as 106% so you can also borrow the money to pay for extras such as stamp duty.
If you would like to speak to one of our Home Loan Consultants, please contact us or use the form on the right to enquire about your finance needs or phone our office on (02) 9609 4655
If you are looking for Personal Loans,Car Loans & Business Finance, visit All Personal Loans for more information and to apply.
Return to Home