The main feature of the Introductory Loan is the lower variable rate offered during an introductory period on new home loans for both owner-occupiers and investors.
The discounted variable rate, however, is still moderately-high, despite the discount, and reverts to a very-high variable interest rate after the honeymoon period.
If you choose the Introductory Loan, you do have the ability to make interest-only repayments and choose to repay your loan weekly, fortnightly or monthly.
Customers can also make additional repayments without being charged a penalty fee and have access to the redraw facility, which you can use to redraw any of these extra repayments.
However, there is no 100 per cent offset account available with this loan. Owner-occupiers can borrow up to 95 per cent of a property’s value with this home loan and investors can borrow up to 90 per cent, though lenders mortgage insurance must be paid for loan amounts above 80 per cent of a property’s value. There is also a minimum amount that customers of this loan must borrow.
The Introductory Loan is suitable borrowers who have not taken out a previous loan with Capricornian.
Since there is an interest-only repayment option, it could be a good option for investors who wish to build up equity in their property while only paying off their interest.
The Capricornian Introductory Loan could be a good loan option if you’re looking to make additional repayments and have access to a redraw facility and also if you want to be able to choose when and how you repay.
Despite the interest rate discounts applied during the introductory period, the variable rates offered are still moderately-high and revert to a very-high rate following this period.
This combined with the moderate establishment cost may not make this loan the best option if the described benefits don’t suit all of your needs, so it’s worth looking into what you need from your home loan and whether the features of this loan tick the boxes.
To find out more about the Introductory Loan offered by The Capricornian, click the link provided below.