The Liberty Financial Liberty Sharp home loan offers borrowers a low variable rate combined with free additional repayments and no account keeping fees. Suitable for a wide range of borrowers – owner occupiers, first home buyers, investors and refinancers – you can borrow between $100,000 and $500,000 for up to 30-year term with as little as a 5 per cent deposit on a property.
Interest rates and fees
This home loan offers relatively low variable interest rates which differ depending on the size of your deposit. Essentially, the higher a deposit you have to put on a property purchase, the lower your interest rate will be. Deposits over 30 per cent attract a very competitive interest rate, while a 20 to 30 per cent deposit comes with a moderately low rate. The variable interest rate for deposits under 20 per cent are the highest offered by the Liberty Sharp home loan, so it’s worth looking around at your options if you plan to get a home loan on a small deposit and still want a competitive rate. Variable interest rates for investment property loans work on a similar sliding scale, except rates for investment properties are slightly higher than owner-occupier interest rates offered under the Liberty Sharp home loan – although still on the low end of the market when compared to other lender’s rates.
Another benefit with the Liberty Financial Liberty Sharp home loan is its lack of ongoing fees: specifically, no account keeping fees, settlements fees, and valuation fees for loans with deposits over 10 per cent. There is a trade-off, though, as there are a few significant one-off fees included in the loan, such as a hefty application or establishment fee, a discharge fee as well as break costs in case of early termination, and a fee each time you use the redraw facility. Although you may save money by waiving ongoing fees, it’s a good idea to take any included charges into consideration when calculating how much this loan will actually cost you, so that you can get a true picture of the loan’s value.
Review of the features
There isn’t a large amount of features attached to the Liberty Sharp home loan, but the few it does offer can go a long way in providing borrowers with repayment flexibility.
Under this home loan, you can make repayments on a weekly, fortnightly or monthly basis, giving you the freedom to create a repayment schedule that best suits your budget. For those who are keen to pay down their home loan as quickly as possible, free additional payments and lump sum payments are available, although keep in mind there is a discharge fee if you pay off the loan before your term is finished. A redraw facility is also available if you’ve made extra repayments and want to draw on your equity for expenses such as a home renovation or – if you’re an investor – as a deposit on another property for your portfolio. Keep in mind a fee is attached to each redraw you make, which may be a factor to take into consideration when deciding whether or not to choose this loan.
On the downside, there are a number of features that aren’t available with the Liberty Sharp home loan. There is no fixed rate or split loan option with this product; no construction facility or line of credit; and no interest only repayment option, although if you are ahead in your loan repayments, you may have the option to skip a payment if needed. This loan also isn’t portable and doesn’t provide an offset account, which may be an issue for borrowers who want to reduce their overall interest using savings from their account.
The Liberty Sharp home loan also doesn’t have a low doc option, although it’s worth noting that Liberty caters to borrowers with unusual employment situations or an impaired credit history. The lender has a number of other products which may suit you if you have a unique income source, or are looking for a low doc option for your home loan.
You can read more information about the Liberty Sharp loan here.
Getting a loan with Liberty Financial
Besides home loans, Liberty Financial also provides a range of business, personal and car loans and is backed by large, global banks such as Deutsche Bank, Credit Suisse and National Australia Bank. The lender has no branches and no ATM network, so the entire loan process can be done through phone and email with payments made online – a useful feature for those who are comfortable dealing with digital technology and online banking. You can also start the indicative pre-approval process online, and electronically access free property reports across a range of different suburbs.
For borrowers who prefer to speak to someone personally about their home loan needs, Liberty Financial has a network of advisors that work all around Australia. By entering your suburb postcode on the lender’s website, you can see which advisors cover your area – including their mobile number, a brief CV and their area of specialty – and request for them to come to your home to discuss your home loan application. This is a potentially helpful service if want to speak to someone face-to-face about applying for a loan but work from home, care for young children, are less mobile and would appreciate the convenience of a home visit.
Who this product suits
This home loan may suit owner-occupier borrowers, refinancers and first home buyers who want a relatively simple home loan with a low variable interest rate and minimal ongoing fees – especially those who have a deposit over 30 per cent and are able to qualify for this home loan’s sharpest rates.
It might also suit investors who may want to use the redraw facility for future property purchases, although given the investment rates are higher than owner-occupier rates under this product, it may be worth looking around to ensure you have the most competitive rate for an investment property loan.
On the other hand, the Liberty Financial Liberty Sharp home loan may not be the right option for you if you want more flexibility in your home loan – for example, if you want to be able to split your loan with a portion fixed, make interest only payments for a period of time, or reduce your interest with an offset account. This product also won’t suit borrowers who need a low doc home loan, in which case it may be worth looking at the other products Liberty offers for borrowers with low doc applications.
Borrowers with a relatively small deposit saved may also want to consider other home loan options. Although the Liberty Sharp home loan allows you to borrow up to 95 per cent of the property’s value, having a deposit of less than 20 per cent – especially if you’re an investor – will disqualify you for the most competitive variable interest rates this loan has to offer.
The Liberty Financial Liberty Sharp home loan offers fairly good value in terms of low interest rates and minimal ongoing fees, more so for those who have a big deposit saved. However, its lack of features may be a drawback for borrowers who want options with their home loan for added convenience, savings and flexibility. Make sure you have a clear picture of what your home ownership goals are and what your financial situation requires, so you can choose the home loan and lender that’s right for you.
Note: This review provides general information about the above home loan. Any views expressed are the author’s own. It is not intended to be a recommendation of a particular product. To the extent that this commentary may constitute general advice, this advice is of a general nature and does not take into account your individual objectives, financial circumstances or needs. We recommend that before you make any financial decision you seek professional advice from a suitably qualified adviser and read the PDS. Read more about our important disclosures here.