Honeymoon rate mortgages are also known as introductory mortgages because banks often tempt you with a low rate for the first few years of your home loan.
These “bait rates” are available on both fixed and variable loans, so you can still tailor your loan to suit your needs while easing into your repayments.
A discounted rate is all well and good, but be aware that the honeymoon rate is quick to change. Many home owners realise that the rate they’ll be stuck with later on isn’t the lowest in the market, and could’ve saved thousands if they went with a standard low rate.
If you miss a payment, don’t be surprised that the honeymoon rate climbs. Things always start out well, but at the first sign of trouble, the honeymoon’s over.
Compare some of the lowest introductory home loan rates in Australia.