Compare cheap home loans

Compare mortgages and calculate mortgage repayments - Data last updated on 22 Aug 2019

Compare cheap home loans

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  • BOQ : Economy Variable Home Loan

    3.59% p.a. Advertised Rate. 3.75% p.a. Comparison Rate*. Extra low interest rate for refinancers. Extra repayments + redraw services. Free redraw facility. Repayments may decrease if RBA cuts rates.
  • UBank : Owner Occupier Fixed Rate

    2.99% p.a. Advertised Rate. 3.45% p.a. Comparison Rate*. Extra low interest rate for refinancers. No upfront or ongoing fees. Repayments will not change during fixed period.
  • UBank : Owner Occupier Discounted Variable Rate

    3.09% p.a. Advertised Rate. 3.09% p.a. Comparison Rate*. Extra low interest rate for refinancers. No upfront or ongoing fees. Extra repayments + redraw services. Free redraw facility.
  • HSBC : Home Value Loan

    3.27% p.a. Advertised Rate. 3.28% p.a. Comparison Rate*. Extra low interest rate for refinancers. No ongoing fees. Parents can sign as guarantor. Extra repayments + redraw services.

The importance of comparing home loans

It's often a good idea to compare some of the cheapest home loans across both standard and variable interest rate loans to see what each entails. When looking for a cheap home loan, make sure you look at every factor that makes up an affordable home loan, from interest rates to upfront fees.

Just because a home loan has the lowest rate, it doesn’t necessarily make it necessarily the cheapest. A good way of checking is to look at the comparison rate which factors in most of the fees a home loan product might include. You may find it’s just as expensive in the long-run.

What makes a cheap home loan?

Home loans with the lowest rate aren't necessarily the cheapest long-term. A good way of making sure you're getting the best deal is to look at the comparison rate, a number that factors in most of the fees a home loan product might include. Once all of this has been factored in, you may find a cheap home loan just as expensive in the long-run.

Can I get a cheap home loan if I have a bad credit history?

Cheap home loans with bad credit history can be challenging to find. If you find yourself in this situation, spend some time building up your credit history, or look at lenders who specialise in non-conforming loans or low-doc loans.

A cheap mortgage can be hard to come by but if you spend some time comparing the options you will find something that fits your budget and saves you money. Beware that you will often be charged a higher interest rate as you will be considered a risk by the lending institution.

What are some other important features of a loan?

There are also multiple other features of a home loan to consider before you settle on one purely based on a low interest rate or cheap fees. Features such as an offset account might include a monthly fee, but if you are going to use it regularly it could ultimately end up saving you thousands of dollars.

Other examples of features you should be comparing are redraw facilities and the ability to make extra repayments on both a regular and irregular basis. What will really make your home loan a cheap home loan is paying down the principal as much as possible and as soon as possible.

As interest on home loans is compounded daily the amount that you repay and the frequency that you repay it will significantly reduce not only the principal amount but the interest you are yet to pay.

FAQs

Tip: You can use RateCity how much can I borrow calculator to get a quick answer.

How much money you can borrow for a home loan will depend on a number of factors including your employment status, your income (and your partner’s income if you are taking out a joint loan), the size of your deposit, your living expenses and any other debt you might hold, including credit cards. 

A good place to start is to work out how much you can afford to make in monthly repayments, factoring in a buffer of at least 2 – 3 per cent to allow for interest rate rises along the way. You’ll also need to factor in additional costs that come with purchasing a property such as stamp duty, legal fees, building inspections, strata or council fees.

If you are planning on renting the property, you can factor in the expected rental income to help offset the mortgage, but again it’s prudent to add a significant buffer to allow for rental management fees, maintenance costs and short periods of no rental income when tenants move out. It’s also wise to factor in changes in personal circumstances – the typical home loan lasts for around 30 years and a lot can happen between now and then.

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^Words such as "top", "best", "cheapest" or "lowest" are not a recommendation or rating of products. This page compares a range of products from selected providers and not all products or providers are included in the comparison. There is no such thing as a 'one- size-fits-all' financial product. The best loan, credit card, superannuation account or bank account for you might not be the best choice for someone else. Before selecting any financial product you should read the fine print carefully, including the product disclosure statement, fact sheet or terms and conditions document and obtain professional financial advice on whether a product is right for you and your finances.

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