10 Important Tips for Getting
Fast, Quick and Easy Home Loans
Let’s face it: Everyone would love a fast,
quick and easy home loan. But it’s a big
step- a big decision.
Here are some important tips you should know about before you take the
plunge
into buying a house and applying for a home loan.
1) Get
information about all the home
loan fees before
signing a home loan contract. There
are many extra fees that
come with buying a new house, such as stamp duty, legal costs,
disbursements,
mortgage insurance, pest inspection report, survey report, builder's
report,
strata inspection report, loan application fee, valuation fee,
registration fee,
refinancing and switching fees, etc. On a mortgage loan of 200,000,
plan for at
least $10,000 in fees, or with mortgage insurance at least $12,000.
2.
Get
information about professional package discounts when seaching for the
best
home loan deals. You
may qualify for professional
packages from a lender if you
earn more than $50,000 a year, or
$80,000 with a partner. The home loan interest rate is usually
discounted by
0.5 per cent- a good deal on a discounted home loan over thirty years. You may also be eligible
for a Relationship discount if you
have other
loans with the bank. Commonly
offered
are home loan discounts, savings account fee waivers and credit card
annual fees.
3.
Be
careful of honeymoon intro rates Home
lenders sometimes offer low
introductory rates.They look great, but these discounted home loan
rates only
last for six months to a year before automatically reverting to the
standard
rate offered by that lender. Still
a
nice discount, but keep in mind it’s temporary.
4.
Beware fixed rates
Fixed rate home loans can look good when interest rates are rising, but
they
also lock you in and are less flexible than variable-rate loans. You
could face
home loan penalty charges if you make additional repayments or pay off
the loan
early.
5.
Alternatives home loan lenders for buying a new house.
If
you can’t get a loan from traditional sources, consider
non-conforming
and "low doc" loan sources. The
interest rates on non-conforming loans are usually higher, but most
come down
at least some after a few years of consistent on time payments.
6.
When
comparing home loans, look at features as well as rates.
Sometimes the home loan lenders with the lowest rates also have the
least
flexible terms. Make
sure you are clear
what they are offering, and don’t just jump into the lowest
rate home loan
without taking a closer look. It’s
most
telling to compare rates with the same basic home loan terms, rather
than
different ones.
7.
Do you need a home loan redraw option?
A redraw facility lets you make extra payments on your mortgage that
you can
then later withdraw and use for other purposes.
This is usually only available on
standard variable home loans, which
are usually more expensive than basic variable home loans.
8.
Don't
rely solely on comparison rates. Home
loan lenders are now required to include comparison rates in
advertisements. However,
be sure to dig
deeper and understand all the fine print, and which type of home loan
works
best for your situation.
9.
Consider getting a line-of-credit loan
in which your
income is paid directly into the loan, thereby reducing interest from
waiting
until each month’s due date to pay.
10.
Use
your home equity to borrow with a home equity loan
The more your loan is paid off, the more of the house you own, which
qualifies
you for larger home equity loans.
These
can help pay off higher interest loans such as credit card debt, or be
used to
invest in home improvement.
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