Bank of Melbourne

Portfolio Loan Fixed 2 Years

Real Time Rating™

1.34

/ 5
Advertised Rate

3.04%

Fixed - 2 years

Comparison Rate*

5.63%

Maximum LVR
90%
Real Time Rating™

1.34

/ 5
Monthly Repayment

$1,271

based on $300,000 loan amount for 25 years

Highlighted

2.49%

Variable

2.49%

UBank

$1,184

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

3.47

/ 5
View Now

RateCity Says: With a discounted variable interest rate and no upfront or ongoing fees, you may be able to minimise the cost of your owner-occupied home loan.

Calculate repayment for Bank of Melbourne product

Advertised Rate

3.04%

Fixed - 2 years

Comparison Rate*

5.63%

Maximum LVR
90%
Real Time Rating™

1.34

/ 5

I'd like to borrow

$

Loan term

years

Your estimated repayment

$1,271

based on $300,000 loan amount for 25 years

Pros and Cons

Pros and Cons

    • No redraw and no offset
    • Ongoing fee
    • Discharge fee at end of loan

    Bank of Melbourne Features and Fees

    Bank of Melbourne Features and Fees

    Details

    Maximum LVR
    90%
    Total Repayments
    Next LVR
    Interest rate type
    Fixed - 2 years
    Borrowing range
    Suitable for
    Investors, Line of Credit
    Loan term range
    1 - 30 years
    Principal & interest
    Interest only
    Applicable states
    ACT, NSW, NT, QLD, SA, TAS, VIC, WA
    Make repayments
    Fortnightly, Monthly, Weekly

    Features

    Extra repayments
    Yes - limited to $10,000
    Redraw facility

    Split interest facility
    Loan portable

    Repayment holiday available

    Allow guarantors

    Available for first home buyers

    Fees

    Total estimated upfront fees
    $800
    Application fee
    $700
    Valuation fee
    $0
    Settlement fee
    $100
    Other upfront fee
    $0
    Ongoing fee
    $14 monthly
    Discharge fee
    $350

    Application method

    Online
    Phone

    In branch

    Pros and Cons

      • No redraw and no offset
      • Ongoing fee
      • Discharge fee at end of loan

      Bank of Melbourne Features and Fees

      Details

      Maximum LVR
      90%
      Total Repayments
      Next LVR
      Interest rate type
      Fixed - 2 years
      Borrowing range
      Suitable for
      Investors, Line of Credit
      Loan term range
      1 - 30 years
      Principal & interest
      Interest only
      Applicable states
      ACT, NSW, NT, QLD, SA, TAS, VIC, WA
      Make repayments
      Fortnightly, Monthly, Weekly

      Features

      Extra repayments
      Yes - limited to $10,000
      Redraw facility

      Split interest facility
      Loan portable

      Repayment holiday available

      Allow guarantors

      Available for first home buyers

      Fees

      Total estimated upfront fees
      $800
      Application fee
      $700
      Valuation fee
      $0
      Settlement fee
      $100
      Other upfront fee
      $0
      Ongoing fee
      $14 monthly
      Discharge fee
      $350

      Application method

      Online
      Phone

      In branch

      Bank of Melbourne is available through brokers

      Madhu Chaudhuri
      5.0
      20 Reviews
      Madhu Chaudhuri’s journey from a practicing Architect to a Broker has shaped her 27-year career in Australia culminating in the formation of her company Finance & Mortgage Solutions in 2001. Her vision to assist people to grow themselves financially, to be able to contribute and flourish in the community is the foundation of her practice, resulting in Industry recognition at the State and National level as a top mortgage broker. At FMS, Madhu leads a multi-lingual team to design and engineer finance solutions whether to build a home and material stability or supporting emerging entrepreneurs to open and run small businesses in their local communities. Coming to Australia as an immigrant herself more than 20 years ago, Madhu has lived experience and understanding of some of the struggles of relocating financially and emotionally- especially for migrants. Recognising the need for multi-lingual and multi-cultural access points, FMS has filled this need for migrant journey’s to be heard and supported. She donates her time for various women’s groups such as Saheli Club and Indian Mums Sydney and receives genuine fulfillment when counselling and advising on financial matters to help women achieve financial independence. She has now also been invited to Lean In Org to be the financial mentor in a workshop series for migrant women. Madhu’s drive lies in genuine connection with the community, recognising that it is built by diverse perspectives and experiences and there is a lot to learn from the young and old collectively. Madhu has sponsored an annual ‘Good Word Award’ at the local public school to support public speaking and communication programs for children for the past 7 years, as well as regular events and outing for the aged South Asian community. Finance & Mortgage Solutions strength lies in guiding, mentoring and coaching clients as well as brokers, which has resulted in growth in cities including Sydney, Melbourne, Brisbane, Adelaide & Canberra. Their services break down a pathway for migrants to financial autonomy into achievable milestones to build a strong, foreseeable financial future in their new country.
      ACT2604
      ACL: 384375

      FAQs

      What is a fixed home loan?

      A fixed rate home loan is a loan where the interest rate is set for a certain amount of time, usually between one and 15 years. The advantage of a fixed rate is that you know exactly how much your repayments will be for the duration of the fixed term. There are some disadvantages to fixing that you need to be aware of. Some products won’t let you make extra repayments, or offer tools such as an offset account to help you reduce your interest, while others will charge a significant break fee if you decide to terminate the loan before the fixed period finishes.

      What is a split home loan?

      A split loan lets you fix a portion of your loan, and leave the remainder on a variable rate so you get a bet each way on fixed and variable rates. A split loan is a good option for someone who wants the peace of mind that regular repayments can provide but still wants to retain some of the additional features variable loans typically provide such as an offset account. Of course, with most things in life, split loans are still a trade-off. If the variable rate goes down, for example, the lower interest rates will only apply to the section that you didn’t fix.

      How do I refinance my home loan?

      Refinancing your home loan can involve a bit of paperwork but if you are moving on to a lower rate, it can save you thousands of dollars in the long-run. The first step is finding another loan on the market that you think will save you money over time or offer features that your current loan does not have. Once you have selected a couple of loans you are interested in, compare them with your current loan to see if you will save money in the long term on interest rates and fees. Remember to factor in any break fees and set up fees when assessing the cost of switching.

      Once you have decided on a new loan it is simply a matter of contacting your existing and future lender to get the new loan set up. Beware that some lenders will revert your loan back to a 25 or 30 year term when you refinance which may mean initial lower repayments but may cost you more in the long run.

      Who has the best home loan?

      Determining who has the ‘best’ home loan really does depend on your own personal circumstances and requirements. It may be tempting to judge a loan merely on the interest rate but there can be added value in the extras on offer, such as offset and redraw facilities, that aren’t available with all low rate loans.

      To determine which loan is the best for you, think about whether you would prefer the consistency of a fixed loan or the flexibility and potential benefits of a variable loan. Then determine which features will be necessary throughout the life of your loan. Thirdly, consider how much you are willing to pay in fees for the loan you want. Once you find the perfect combination of these three elements you are on your way to determining the best loan for you. 

      What is a variable home loan?

      A variable rate home loan is one where the interest rate can and will change over the course of your loan. The rate is determined by your lender, not the Reserve Bank of Australia, so while the cash rate might go down, your bank may decide not to follow suit, although they do broadly follow market conditions. One of the upsides of variable rates is that they are typically more flexible than their fixed rate counterparts which means that a lot of these products will let you make extra repayments and offer features such as offset accounts.

      When should I switch home loans?

      The answer to this question is dependent on your personal circumstances – there is no best time for refinancing that will apply to everyone.

      If you want a lower interest rate but are happy with the other aspects of your loan it may be worth calling your lender to see if you can negotiate a better deal. If you have some equity up your sleeve – at least 20 per cent – and have done your homework to see what other lenders are offering new customers, pick up the phone to your bank and negotiate. If they aren’t prepared to offer you lower rate or fees, then you’ve already done the research, so consider switching.

      How can I calculate interest on my home loan?

      You can calculate the total interest you will pay over the life of your loan by using a mortgage calculator. The calculator will estimate your repayments based on the amount you want to borrow, the interest rate, the length of your loan, whether you are an owner-occupier or an investor and whether you plan to pay ‘principal and interest’ or ‘interest-only’.

      If you are buying a new home, the calculator will also help you work out how much you’ll need to pay in stamp duty and other related costs.

      How can I get a home loan with no deposit?

      Following the Global Financial Crisis, no-deposit loans, as they once used to be known, have largely been removed from the market. Now, if you wish to enter the market with no deposit, you will require a property of your own to secure a loan against or the assistance of a guarantor.

      How can I pay off my home loan faster?

      The quickest way to pay off your home loan is to make regular extra contributions in addition to your monthly repayments to pay down the principal as fast as possible. This in turn reduces the amount of interest paid overall and shortens the length of the loan.

      Another option may be to increase the frequency of your payments to fortnightly or weekly, rather than monthly, which may then reduce the amount of interest you are charged, depending on how your lender calculates repayments.

      What if I can't pay off my guaranteed home loan?

      If you can’t pay off your guaranteed home loan, your lender might chase your guarantor for the money.

      A guaranteed home loan is a legally binding agreement in which the guarantor assumes overall responsibility for the mortgage. So if the borrower falls behind on their mortgage, the lender might insist that the guarantor cover the repayments. If the guarantor fails to do so, the lender might seize the guarantor’s security (which is often the family home) so it can recoup its money.

      What is a bad credit home loan?

      A bad credit home loan is a mortgage for people with a low credit score. Lenders regard bad credit borrowers as riskier than ‘vanilla’ borrowers, so they tend to charge higher interest rates for bad credit home loans.

      If you want a bad credit home loan, you’re more likely to get approved by a small non-bank lender than by a big four bank or another mainstream lender.

      How do guaranteed home loans work?

      A guaranteed home loan involves a guarantor (often a parent) promising to pay off a mortgage if the principal borrower (often the child) fails to do so. The guarantor will also have to provide security, which is often the family home.

      The principal borrower will usually be someone struggling to find the money to enter the property market. By partnering with a guarantor, the borrower increases their financial power and becomes less of a risk in the eyes of lenders. As a result, the borrower may:

      • Qualify for a mortgage that they would have otherwise been denied
      • Not be required to pay lender’s mortgage insurance (LMI)
      • Be charged a lower interest rate
      • Be charged less in fees

      What is a low-deposit home loan?

      A low-deposit home loan is a mortgage where you need to borrow more than 80 per cent of the purchase price – in other words, your deposit is less than 20 per cent of the purchase price.

      For example, if you want to buy a $500,000 property, you’ll need a low-deposit home loan if your deposit is less than $100,000 and therefore you need to borrow more than $400,000.

      As a general rule, you’ll need to pay LMI (lender’s mortgage insurance) if you take out a low-deposit home loan. You can use this LMI calculator to estimate your LMI payment.

      Does Australia have no-deposit home loans?

      Australia no longer has no-deposit home loans – or 100 per cent home loans as they’re also known – because they’re regarded as too risky.

      However, some lenders allow some borrowers to take out mortgages with a 5 per cent deposit.

      Another option is to source a deposit from elsewhere – either by using a parental guarantee or by drawing out equity from another property.

      How can I get a home loan with bad credit?

      If you want to get a home loan with bad credit, you need to convince a lender that your problems are behind you and that you will, indeed, be able to repay a mortgage.

      One step you might want to take is to visit a mortgage broker who specialises in bad credit home loans (also known as ‘non-conforming home loans’ or ‘sub-prime home loans’). An experienced broker will know which lenders to approach, and how to plead your case with each of them.

      Two points to bear in mind are:

      • Many home loan lenders don’t provide bad credit mortgages
      • Each lender has its own policies, and therefore favours different things

      If you’d prefer to directly approach the lender yourself, you’re more likely to find success with smaller non-bank lenders that specialise in bad credit home loans (as opposed to bigger banks that prefer ‘vanilla’ mortgages). That’s because these smaller lenders are more likely to treat you as a unique individual rather than judge you according to a one-size-fits-all policy.

      Lenders try to minimise their risk, so if you want to get a home loan with bad credit, you need to do everything you can to convince lenders that you’re safer than your credit history might suggest. If possible, provide paperwork that shows:

      • You have a secure job
      • You have a steady income
      • You’ve been reducing your debts
      • You’ve been increasing your savings

      How much can I borrow with a guaranteed home loan?

      Some lenders will allow you to borrow 100 per cent of the value of the property with a guaranteed home loan. For that to happen, the lender would have to feel confident in your ability to pay off the mortgage and in the security provided by your guarantor.

      What is a guarantor?

      A guarantor is someone who provides a legally binding promise that they will pay off a mortgage if the principal borrower fails to do so.

      Often, guarantors are parents in a solid financial position, while the principal borrower is a child in a weaker financial position who is struggling to enter the property market.

      Lenders usually regard borrowers as less risky when they have a guarantor – and therefore may charge lower interest rates or even approve mortgages they would have otherwise rejected.

      However, if the borrower falls behind on their repayments, the lender might chase the guarantor for payment. In some circumstances, the lender might even seize and sell the guarantor’s property to recoup their money.

      How do I take out a low-deposit home loan?

      If you want to take out a low-deposit home loan, it might be a good idea to consult a mortgage broker who can give you professional financial advice and organise the mortgage for you.

      Another way to take out a low-deposit home loan is to do your own research with a comparison website like RateCity. Once you’ve identified your preferred mortgage, you can apply through RateCity or go direct to the lender.

      What is breach of contract?

      A failure to follow all or part of a contract or breaking the conditions of a contract without any legal excuse. A breach of contract can be material, minor, actual or anticipatory, depending on the severity of the breaches and their material impact.

      What happens when you default on your mortgage?

      A mortgage default occurs when you are 90 days or more behind on your mortgage repayments. Late repayments will often incur a late fee on top of the amount owed which will continue to gather interest along with the remaining principal amount.

      If you do default on a mortgage repayment you should try and catch up in next month’s payment. If this isn’t possible, and missing payments is going to become a regular issue, you need to contact your lender as soon as possible to organise an alternative payment schedule and discuss further options.

      You may also want to talk to a financial counsellor.