A house is made of bricks and stone but a home is made of heart alone. You stay at your home as your heart belongs to your home. So, you should always prefer to have your home located at a convenient position so that in order to buy the home or construct the building, you can get the Best Home Loan Rates, without much leaps and bounds.
The flexibility of the home loans
Take time in hands to notice repayments to be made each month is much lower when the interest rate is equally lower. Therefore for recognizing the best home loan rate, it is important to consider the comparison rate on the taken home loan, since the comparison rate includes the charges as well as the hidden fees. With the comparison rate, comparing for the best home loan rate becomes easier. More flexible you are with the comparison rates; it is much easier for you to achieve the best home loan rate to be repaid to the home loan agency. When it suits your purse, then the home loan becomes the best for you since being ensured of the best home loan rate, you assure yourself as well as the home loan agency on repaying the amount on time or even before tenure. As fast as you can repay the loan, it is much easier for you to settle down to lead a comfortable life.
Variable Rate as against Fixed Rate
As there is a change in the current market rates, automatically the interest rate levied on the loan taken begins to vary; it is referred to as a variable interest home loan rate. Therefore it is a clear indication that the loan you have borrowed would vary affecting the repayment amount on every month as well as each year. On the other hand, when the Fixed Home Loan Rate is chosen over the Variable Rate, then as a borrower you are bound to remain glued to the static rate over the repayment tenure, for instance when you have chosen to repay the loan within three years, or six years at a particular rate then the rate for your repayment remains all the same. Thus, the repayment you are making or you need to make shall remain the same while the time frame continues. Despite the RBA increasing or decreasing the official cash rate, the rate on repayment remains the same. As a rational borrower, it is normal to go for the fixed rate with the low rates prevailing so that your repayments are within affordability – while the repayment is lower it is highly purse permissible. So there is no need to fear even if the interest rates soar high. Moreover, there are instances when the high rates sometimes predict of its going down, thereby giving an opportunity to the borrowers for choosing the variable rate, so that they are able to reduce their repayments with the drop in interest rates.
Fine! You shall have to take three factors into consideration while choosing the Best Home Loan Rates. Let us know about the three nominative factors comprising of the Best Home Loans:
- The Lowest Rates of Interest: Well, it is much clear by now that a lower interest rate is a vivid indication of lesser repayments. Once you are able to make a savings of a few handful points of the interest rate, then it is a huge advantage to you to meet up with higher and added savings over a long time mortgage life.
- Limited Amount of Fees: You are a rational borrower; therefore it is your prime responsibility to check on the fees while you are making a comparison to figure out the best home loan rates. Never choose the home loan imbibed with numerous fees. Always opt for the home loan devoid of the multiple fees thus you shall be able to forego higher costs for the time period.
- Features of the rates needed: Home loans having additional features offer higher flexibility in the loan management as well as to clear the timely repayments. For cutting down the interest repayments, Offset Accounts are helpful in this regard. Tying the mortgage with different financial products like the personal loans and savings, credit cards and transaction accounts to establish discounts and convenience is possible by using the Package Loans. There are emergency cases where you are free to abide by the Redraw Facilities to withdraw the additional paid dollars into the mortgage.
- An Offset Account: The transaction account kept in attachment to your home loan is the offset account. To calculate the interest, the 100% offset account’s balance is a deducted from the principal remaining behind on the loan. As offset is able to save the rational borrower thousand dollars and in turn, save a number of years of the taken mortgage.
- Comparison of the Home Loan Packages: Never miss out on the excellent opportunity by moving the banking to the lender since the lenders are able to provide a lower rate of interest as well as other discounts. Often termed as Professional Package Loans, the Package Home Loans collect and tie a number of products together with your lender, which includes the transaction accounts, credit cards, and personal loans and savings. The borrower shall eventually gain benefits from the decreased home loan interest rates and the fees along with the associated linked products. In exchange, you shall be paying the annual fee within the range from Australian dollar 150 to 400, maybe even more than the estimated amount in a few cases.
- Redraw facilities: For paying off the home loan at a faster rate, the applicable solution is the redraw facility or the offset account. With the help of both the redraw facilities and the offset account, you are free to invest the money against the loan, while the redraw facility facilitates to invest the money directly on the loan and the offset account is reliable when the money is being invested indirectly against the loan. Redraw facility is convenient to borrow the money already repaid that is generally offered with the variable interest home loan rates. Using the redraw facility, you can be flexible regarding the means of loan repayment. As long as the borrower is having the spare money invested in savings, it is easier to pay the amount to the loan.