This tutorial helps you understand the basic differences between different home loan types, without the need to talk with a Mates Rates mortgage professional.

Whilse the core loan products are unchanging the Australian mortgage market doesn’t stand still. New deals, special rates and limited offers appear almost every day. So much so, interest rate websites can’t cope.

Your Mates Rates mortgage broker accesses to up to the minute information on 400+ different mortgage products from our leading panel of mortgage lenders. Using this information, leading edge independent tools and a wealth of professional experience, your mortgage broker ranks these home loan deals to find the right loan and lender for you.

Principal & Interest Home Loan

Principal is the actual money you have borrowed and interest is the fee lenders charge you whilst you owe this money.

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Interest Only Home Loan

Repayment of the principal is deferred for an agreed period and during this time you only pay the interest charges which results in a lower minimum payment.

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Basic Variable Home Loan

Basic variable home loans generally have a lower interest rate yet less flexibility and fewer loan features than a standard variable home loan.

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Standard Variable Home Loan

Standard variable is the Rolls Royce of mortgages. This loan type usually has a big set of loan features from offset accounts through to portability, fee free redraw and much more.

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Fixed Rate Home Loan

The interest rate on a fixed rate loan does not change during the fixed rate period which means your minimum payment does not change either, so you can budget and plan with more confidence.

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Split Rate Home Loan

A Split Rate home loan allows your total borrowings to be split into different loan types. The most common is part fixed, part variable which is a good way to get flexibility and safety at the same time.

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Introductory Rate Home Loan

The interest rate is usually low to attract borrowers. Also known as a honeymoon rate, this rate generally lasts only for or short term before it jumps up to a much higher variable rate

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Line of Credit

A Line of Credit is like a personal overdraft or very large credit card. Lines of credits are commonly used to raise funds for investment or personal use by providing cash up to set limit which remains in place for the full term of the loan.

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The information on this page will help you understand the basic loan types, although the features, how much they cost and how they affect you varies lender to lender.

Remember, this is only a brief overview of some options available in the Australian mortgage market place. Features of each loan, including the amount borrowers will lend you, per use fees and important functionality varies between lenders.

Limited deals, special rates and limited offers come and go almost every day so when you are ready to find a home loan with someone you can trust, talk to a professional.

Call us on 1300 55 81 61 or request a free appointment by filling out the form below – No charge, no obligation and with the comfort of a time and place that suits you.

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