Arab Bank Australia Fixed Rate Loan

Features

If have a fixed income, or are on a fixed budget, then the Arab Bank Australia  Fixed Rate Home Loan can provide you with the peace of mind of fixed repayments for up to five years.

A minimum loan amount of $50,000 applies, which is a reasonably low minimum, making the loan potentially suitable for refinancers.

Arab Bank Australia allows you to make weekly, fortnightly or monthly repayments so that you can create a payment scheme that suits you.

You can borrow up to 95 per cent of the property’s value with this loan, as long as you pay for lenders mortgage insurance. You’ll need to pay for this insurance if you borrow more than 80 per cent of the value of the property, which is pretty standard. But if you have just a five per cent deposit, then this may be enough to get this home loan.  But bear in mind lender mortgage insurance protects the lender, not you, against loan default.

Arab Bank Australia doesn’t allow extra repayments on its fixed loans, so once you’ve locked in, your payments are fixed and you can’t reduce interest costs as you can on most variable loans that allow extra repayments. And if you break the fixed loan early, you’ll have to pay hefty break costs, another downside of fixed loans.

If, after five years you like the security of your fixed rate but your fixed period has come to an end, you can apply to extend the length of your fixed period. The loan is also portable, so if you want to buy another home, your loan can potentially pay for that property.

Who is the Arab Bank Australia Fixed Rate Loan good for?

The Fixed Rate Loan from the Arab Bank Australia could suit buyers on a budget or investors who want the certainty of knowing their home loan repayments for up to five years. The loan may also suit refinancers as it has a relatively low minimum amount. 

Review - What RateCity says

The Arab Bank Fixed Rate Loan is a basic loan that could suit owner-occupiers or investors who aren’t bothered by the five-year limit on fixed terms. The minimum five per cent deposit requirement makes it a good entry-level loan for first home buyers. But you’ll need to weigh up the financial impact of the relatively high upfront and ongoing fees with the benefit of knowing what your home loan repayments will be and the relatively low interest rates.  You’ll also need to keep in mind that extra repayments aren’t allowed, so you won’t be able to reduce interest costs on the loan by doing this or repaying early.

Arab Bank Australia Fixed Rate Loan Options

The Arab Bank Australia Fixed Rate Loan allows you to choose how long you have your loan under a fixed rate for.

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Fixed Rates from

3.15%

Advertised rate

3.92%

Comparison rate
Pros
  • Branches in NSW and Victoria.
  • Loan portability.
  • One to five year fixed rate.
Cons
  • No redraw facility.
  • No offset account.
  • Hefty upfront fee.
Eligibility

Five per cent deposit.

Mortgage insurance for loans where over 80 per cent of property’s value is borrowed.

Must meet serviceability criteria.

Suitable For
  • First Home Buyers
  • Owner-Occupiers
  • Refinancers
  • Investors
Fees
  • Estimated upfront fees: $600.00
  • Discharge fees: $250
  • Ongoing fees: $0

There are quite a few fees built into the Arab Bank Australia Fixed Rate Loan. The bank charges a reasonably high upfront fee, an ongoing monthly fee and a moderate discharge fee. While these fees aren’t the highest, it’s a good idea to work out how all your finances will be impacted before beginning the application process.

Features
  • Redraw facility
  • 100% offset account
  • Unlimited extra repayments
  • Weekly repayments
  • Fortnightly repayments
  • Monthly repayments
  • Loan allows split interest rate
About Arab Bank Australia

Arab Bank Australia has branches all across New South Wales and Victoria. Opening times for different branches vary depending on location, however their call centre is open for eight hours a day, five days a week. Their website also has an online enquiry form that can be filled out 24/7 for a response the next day.

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