Online lender loans.com.au has made life easier for younger Australians by making changes to two mortgages popular with first home buyers.
The Offset loan has been reduced from 4.04 to 3.72 per cent (comparison rate 3.74 per cent).
This product has a maximum LVR (loan-to-value ratio) of 90 per cent, allowing first home buyers to enter the market with a smaller deposit.
Meanwhile, the maximum LVR for the Essentials loan has been increased from 80 to 90 per cent.
The Essentials loan has an interest rate of 3.64 per cent (comparison rate 3.66 per cent).
Here’s how much first home buyers would have to pay if they took out a 30-year, $350,000 mortgage:
|Loan / rate||Monthly repayments||Total repayments|
|Offset / 3.72%||$1,615||$581,383|
|Essentials / 3.64%||$1,599||$575,689|
Managing director Marie Mortimer said loans.com.au is noticing increased activity from first home buyers, as some property markets become more affordable.
“People buying for the first time haven’t usually been able to accumulate as much equity as those who have already enjoyed the capital gains from home ownership, but we don’t think they should be penalised for that,” she said.
“To help them take advantage of this long-awaited opportunity to enter the market, we have reduced our interest rate on LVR 90 Offset home loans to the same as LVR 80, and offered our streamlined Essentials home loan at LVR 90 for the first time.”