The Home Loan from Southern Cross Credit Union is available to new home purchasers and refinancers and also has an investment option and a line of credit option.
If you are not on the line of credit, you can split your loan into a variable portion and a fixed rate portion in order to take advantage of the benefits provided by each of these rates. However, the offered variable interest rates are high.
Although, low fixed rates are available on owner-occupied loans, though they increase to a moderately high rate as you increase your fixed term from one to five years.
Investors have access to a very low fixed rate for the two year fixed term option, but the one and three year terms have a moderate fixed rate with a moderately high to high rate from four to five year terms. Even if you’re able to lock in one of the lower fixed rates, your loan will revert to the high variable rate following your fixed period. On the bright side, this loan offers a few avenues through which you could reduce your overall loan cost and even pay your loan off early, such as with the 100 per cent offset account – which you can use on the variable portion of your loan. By depositing funds into the offset account, which works like a savings account, you offset the interest payable on your loan because interest is only calculated on the difference between your loan balance less your offset account balance. Or, you can pay your loan off early through making additional repayments on variable or fixed rate options.
Although, you might be charged a fee for making early repayments over a certain amount or for paying your loan off early during a fixed term. The redraw facility lets you withdraw these funds should you need to re-access any of your additional repayments, and while this option is available for fixed and variable loans, you will be charged a fee for each redraw.
The 100 per cent offset account and ability to make early repayments and redraw is not available on the line of credit option. However, lump sum repayments and access to your property’s equity through a line of credit is exclusive to this option only.
An attractive feature on the Home Loan, particularly for investors, is the ability to have an interest-only period where you’d only have to pay the interest charged on your loan. This could give you time before making your principal repayments to accrue equity in your property, or even sell your property following the interest-only period and use the funds to pay your loan in full.
You must be borrowing a minimum loan amount of $10,000 and be a member of Southern Cross Credit Union or meet the eligibility criteria to qualify for the Home Loan and the investment option.
Who is the Southern Cross Credit Union Standard Loan good for?
The Southern Cross Credit Union Standard Loan works for a range of buyers due to its options between fixed and variable rates, principal and interest or interest only repayments, loan splitting, a 100 per cent offset account and a line of credit option.
The Home Loan is available to first homebuyers, new home purchasers, investors or refinancers, however you must be a Southern Cross Credit Union member to qualify.
Review - What RateCity says
Southern Cross Credit Union Standard Loan Options
The Southern Cross Credit Union Home Loan could be a sound loan option for an array of customers thanks to its combination of repayment options and added features. Even though low fixed rates are available, the major negative of this loan is the high variable interest rate and higher rates at longer fixed terms. Also, the high upfront cost might be enough to make you go over your bottom line. It’s worth your time to add up what the cost of this loan will be to you and to see if all of the features meet your criteria before you can determine if the Home Loan is your most suitable option.
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