Home loan comparisons can be confusing

Why does it have to be so difficult?

If your loan is anything other than plain vanilla then getting an accurate comparison can be complex. Especially for larger loans, loans that have multiple security properties involved fixed interest rates, loans with guarantor or trust etc then it can become very complex. Unfortunately lenders don’t always make all fees or even the loan features clear, in fact it is often what they don’t say that is the important thing to know. And they certainly don’t usually publish their “best rate” on their web sites. Not all lenders will negotiate but many do and for loans over $500,000 with good equity can often be negotiated. We currently see discounts of 1.30 percent for good proposals so it is worthwhile asking. At the same time do not let yourself be lured by discount claims, you must look at the bottom line and compare loans based on how much will this loan actually cost.

You need to understand how to really compare what’s available on the home loan market then we have always believed that the best way to compare two products apart from their features, is to decide on a period – say 5 years and compare how much one home loans costs in straight dollar terms when compared to another.

It is quite a complex calculation however we take the actual amount you will pay in interest plus all known upfront, exit and ongoing fees. This allows you to see in simple dollar term a full home loan comparison. Of course we then show you the features and benefits that will then allow you to come to a fully informed decision.

Cost of Loan Comparison

Sample comparison of variable rate home loans (sample as at 15/05/2015) available for loans over $500,000 and under 80% LVR

This is just an example of some current offerings – contact us to have a comparison report for your situation – it is free and no obligation.

The following table shows the calculated cost of your loan if you were to refinance at a given time – for this example the calculation period is based on paying out the loan after 5 years ( 60 months) on a loan amount of $500,000 taken over a standard term of 30 years.

Lender
Product Description
Min Loan
Max LVR
Initial Rate
Initial Months
Ongoing Rate
Actual Cost

AMP

Essential Home Loan

$40,000

90%

4.40%

0

4.40%

$105968

ANZ

Breakfree

$500,000

80%

4.73%

0

4.73%

$115685

CBA

MAV

$500,000

80%

4.75%

0

4.75%

$116110

Citibank

Mortgage Plus

$500,000

80%

4.43%

0

4.43%

$108365

Firstmac

VIP Package 80 Broker Special

$250,000

80%

4.44%

0

4.44%

$106817

Heritage

Discounted Variable Offer

$150,000

95%

4.34%

0

4.34%

$104142

ING

Fixed – 5 Year Package split

$250,000

80%

4.39%

60

4.58%

$105326

Macquarie

Offset Package

$150,000

70%

4.59%

0

4.59%

$113072

ME Bank

Fixed 3 years

$50,000

95%

4.28%

36

4.88%

$108565

NAB

HomePlus

$250,000

90%

4.79%

0

4.79%

$116342

St George

Fixed 5 Year Advantage

$250,000

95%

4.49%

60

4.79%

$109823

Suncorp

Home Package Plus

$500,000

80%

4.49%

0

4.49%

$107798

Teachers Mutual

Solutions + Fixed Option 3 Yrs

$25,000

95%

4.09%

36

4.62%

$104483

Westpac

Flexi First Option

$50,000

95%

4.84%

24

5.05%

$119953

Disclaimer: Whilst every effort has been made to ensure the accuracy of this calculator we rely on lenders and third parties to keep us up to date, the results should be used as an indication only. Where they constitute a quote they are our best effort and should not be considered a pre-qualification for a home loan.

You know many people will ask a motor mechanic for advice on which car to buy because mechanics work every day on cars. So why not save yourself a lot of stress and probably money and ask a mortgage broker which home loan is best for you – after all we work day in day out on home loans. We will provide you with a detailed home loan comparison report (see below) showing features and actual full cost of each loan. Of course there are hundreds (maybe thousands) of different loans available, variable rate, fixed interest rate, interest only, equity loans etc. When you look at some home loan comparison sites the options are overwhelming – you may end up more confused. Where as we understand the benefits and the limitations of the various home loans on offer and we know which lenders do each loan best. So like your mechanic we know our stuff and best of all our advice to you is free because the lenders will pay us to arrange your loan – we will fully disclose our commissions before you make your decision.

In 2003 the government introduced mortgage comparison rate regulations for a number of reasons this regulation has basically been a failure  particularly where it comes to fixed interest rates and in 2011 mortgage brokers were exempted from having to quote comparison interest rate rates. The failure of the legislated comparison rate eventually highlighted that the interest rate is maybe not the right place to focus.

Our comparison report allows you to compare home loans from any number of lenders.

contact us now for a great home loan