While there is no doubt that having a cheap home loan is something that most of us strive towards, it is important not to make the mistake of only concentrating on the interest rate. Home loans are made up of a number of significant features and only one of these is their interest rate.
In choosing a home loan it is important that you also take into consideration the following:
– Does the loan come with an offset facility allowing you to deposit your pay directly into the mortgage and save interest (no matter what the applicable rate is);
– Can you redraw some of the finds if you require money in the event of an emergency?
– What are your monthly/annual fees?
– Are you able to fix part or all of your loan or does the lender not offer fixed home loans?
– Do you have special circumstances that very few lenders will accept – that makes finding the right lender even more important.
All too often the first question the potential borrowers pose are – what is you interest rate?
In today’s economic climate a loan that is the cheapest in February may not be the cheapest in March – you need to ensure that the home loan you pick is a good fit with your lifestyle, income and future plans. Sometimes a home loan that has a slightly higher rate gives you as the borrower a lot more freedom which is worth the extra cost.