Popular types of Home Loans

September 12, 2014
Jenika Clifford

There are many types of home loans to choose from, by selecting the right loan product with the right features, it can help you pay your mortgage off quicker. Your Mortgage Broker can provide you with expert advice on the right home loan product/lender to suit your circumstances.


Variable Loan

The rate charged on a variable loan fluctuates up and down in accordance with movements in interest rates, as set by the Reserve Bank.

  • Basic Variable – usually a lower interest rate than a standard variable but less flexible; may not have additional features or the features may be more restrictive or have higher fees.
  • Standard Variable – generally offers a more competitive variable interest rate than a basic variable, usually offering more features making the loan more flexible.

Fixed Rate Loan

All fixed interest rate loans are set at a specific interest rate for a set period of time. This means you can “lock in” your repayments for the fixed rate period, usually between 1-5 years. Once fixed rate expires you can roll over to a variable loan or fix again for a set period of time.

Interest-only loan

Repays only the Interest on the Principal during the term of the loan. Once the interest-only period expires, usually within 1-5 years, you must start marking Principal and Interest repayments over the remaining term of the loan.

Line of credit loan

Combines the borrower’s home loan from which you can draw cash up to a pre-approved limit with an everyday transaction account. This usually revolves around equity built up in the property and allows access to funds when needed.


Please be aware these are only outlining a few different loan types; seeking professional advice is highly recommended, to ensure you are receiving the right product to suit your circumstances.


Ensure you shop around for the right loan product and lender; as rates are volatile, lenders are changing their loans and becoming very competitive to secure borrowers business.


Contact Mortgage Choice Bundall on 07 5504 5569; we do all the research for you with 27 leading lenders on our panel and over 300 different loan products to choose from; choosing the right home loan for you is a stress free process.


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