BOQ’s First Start Loan offers owner-occupiers several features, including a 100 per cent offset account, whereby your savings in your offset account reduce your home loan principal and help cut interest costs payable on the loan.
There is no limit on additional repayments, so you make as many extra repayments as you like without penalty and pay off your loan sooner and save on interest. There is also a free redraw facility, so you have access to any excess repayments, with a minimum of $100 applying for withdrawals.
Customers can borrow up to 95 per cent of the property's value with lenders mortgage insurance, which is required for loan amounts over 80 per cent of the property’s value. The home loan period is available for up to 30 years. Another flexible feature is that there is no minimum mortgage amount.
You can also make interest only repayments (for a maximum of five years) as well as principal and interest repayments. Of course, with interest only loans you don’t pay off any of the principal during the loan period. But such an option allows you to get into the property market more quickly and maintain minimal home loan repayments.
BOQ’s First Start Loan suits owner-occupiers, including first home buyers, given the low introductory rate. It offers flexible repayment options and you can mould your repayment obligations to your own income schedule. But the loan isn’t available to investors or refinancers, which limits its suitability.
BOQ charges hefty upfront and ongoing fees on this loan, but there are other attractions. The small deposit required allows first home buyers to get a foot in the housing market without exhausting all of their finances – but watch out for the lenders mortgage insurance, which protects the lender, not you, against loan default. You’ll need to pay for this is your deposit is less than 20 per cent of the property’s value. You’ll also get an offset account and unlimited repayments, allowing you to cut interest costs on the mortgage.
While this loan has some hefty fees, you may get the attention that a small business can offer while getting access to facilities that larger banks have. This does create larger overheads, however, which are passed on to you in the form of higher fees, so it may be wise to use our online calculator to double check if you’ve got everything covered before you apply for this loan.
The First-Start Loan from BOQ gives you a competitive variable loan with a doable deposit size.