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Loans.com.au offering mortgages at just 2.88%

Loans.com.au offering mortgages at just 2.88%

Eric* wanted three things from a home loan: he wanted a low interest rate, no ongoing fees and a simple online application process.

After researching a range of Australian mortgage providers, Eric chose loans.com.au and its Smart Home Loan.

By qualifying for the Smart Home Loan, Eric was able to get a mortgage interest rate of just 2.88 per cent (comparison rate of 2.90 per cent). 

Eric had to pay $520 in upfront fees – a $300 settlement fee and a $220 valuation fee. However, he was pleased that loans.com.au would not be charging him monthly or annual ongoing fees just for the privilege of paying off his mortgage, unlike some other lenders.

Smart Home Loan key features

  • Minimum deposit of 20%
  • Loan size of $50,000 to $1 million
  • Loan term of 15 to 30 years
  • Principal-and-interest repayments
  • Unlimited free redraws
  • Unlimited free additional repayments

Here’s how much it would cost Eric to pay off a Smart Home Loan, based on a 2.88 per cent interest rate and 30-year loan term:

Loan size

Monthly repayments

Total repayments

$250,000

$1,038

$373,644

$500,000

$2,076

$747,288

$750,000

$3,114

$1,120,931

$1 million

$4,152

$1,494,575

Loans.com.au and repayment data accurate as at 17 October 2019

Mortgage application done online, not in-branch

The other reason Eric chose loans.com.au was because he wanted a simple online application process – so it made sense for him to take out his mortgage through an online lender.

Eric began by filling out an online application form, which took just a few minutes. Next, he booked a phone appointment with a loans.com.au lending manager so his application could be reviewed and lodged. Eric was then able to track and manage his application with loans.com.au’s onTrack app.

* Eric is not a real person. This is a hypothetical case study. 

Please note that a low-rate home loan, like the loans.com.au Smart Home Loan, won’t necessarily be the best home loan for your situation. You should seek professional financial advice before taking out a mortgage.

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This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.

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