This home loan offers a discounted introductory rate for the first 12 months from settlement. Unlike a typical introductory deal though, the interest rate in the first year of this loan is guaranteed to remain steady despite the fact that this product is a variable mortgage.
After the first year, however, the interest rate reverts to the standard variable rate offered by Commonwealth Bank, which is a significantly higher rate than the market average. The rate going forward is variable in the traditional sense, meaning it may fluctuate over time.
One of the main features of this loan is a mortgage offset account, which is a popular option for borrowers.
The loan also allows extra repayments to be made, which may be a good way to pay down the loan sooner.
A redraw facility is available on this loan, meaning the borrower may be able to draw on equity in the property to use for other purposes such as home renovations.
The Commonwealth Bank Introductory 1 Year Guaranteed Rate Loan allows for borrowing with as little as a 5 per cent deposit for eligible customers. But be aware that borrowing with a deposit of less than 20 per cent may result in the borrower incurring an additional charge of lenders’ mortgage insurance.
The Commonwealth Bank Introductory 1 Year Guaranteed Rate Loan may be suitable for both owner-occupier borrowers and investor borrowers alike.
It might suit someone who prefers to bank with one of the Big Four banks of Australia.
This loan might be suited to someone who likes the perks of being able to use an offset account and make extra repayments.
The loan may also suit a borrower with as little as a 5 per cent deposit in savings.
The Commonwealth Bank Introductory 1 Year Guaranteed Rate Loan is a variable rate home loan product with a ‘fixed’ rate for the first year. After the first 12 months, the rate reverts to a relatively-high standard variable rate.
The loan also has upfront and ongoing fees, and a discharge fee when the loan is closed. Borrowers may also incur a ‘break fee’ if refinancing or closing the loan within the first year.
A full-featured product, this loan offers a mortgage offset account, redraw facility and it allows for extra repayments – all of which are popular loan features. However, the costs may outweigh the benefits so borrowers should factor this into their decision.
The Commonwealth Bank Introductory 1 Year Guaranteed Rate Loan has two options available, one for those looking to live in the property and a product for investor borrowers.