Introductory home loans offer highly competitive interest rates - But whats the catch?

With the intense competition in Australia's home loan market today, home mortgage lenders are working harder and harder to capture our attention in order to win our business. One of the ways in which mortgage lenders attract our attention is by offering introductory loans with low interest rates for a period of usually between three and 12 months. Here we take a look at the introductory home loan detailing the benefits & pit falls of such an offer.

DOMDocument::loadXML(): Start tag expected, '<' not found in Entity, line: 2

Looking for a great value home loan with super fast approval?

Get Pre-Approval online & get a response in minutes with MyRate.

Introductory home loans and the honeymoon rate

The introductory home loan offer (also known as a honeymoon rate) provides borrowers with a highly competitive interest rate, generally for a period of between three and 12 months. These introductory home loans are designed to both attract new home buyers as well as to lure existing home borrowers away from their existing mortgage provider. At the end of the honeymoon home loan period, the interest rate on the mortgage will generally revert to the standard variable home loan interest rate of the mortgage provider.

When considering an introductory home loan

If you are considering to take out a new home loan, then it will definitely pay to find a mortgage provider who is offering a highly competitive introductory home loan rate. Shop around and compare the different mortgage providers for the best deal. But, you must be careful here. You should not choose a home loan based purely on the low interest rate provided in the honeymoon introductory period. You should also carefully consider the standard variable interest rate that the loan will revert to once the honeymoon period is over. Also, calculate your repayments on this higher amount, as this is what you will be paying in three to 12 months time when the honeymoon rate expires.

Likewise, if you already have a home loan with another mortgage provider, carefully consider whether you will be better off in the longer term before deciding to switch to another lender in order to take advantage of their introductory home loan offer. Will the standard variable interest rate remain lower than the rate you are paying now once the honeymoon period is over? And what fees or penalties will you incur by paying out your existing home loan early?

DOMDocument::loadXML(): Start tag expected, '<' not found in Entity, line: 2

Digg this Post page to del.icio.us Post page to Furl

Introductory home loans reviewed A low rate but whats the catch

Home Loan Info.com.au

Home Loans Australia

Refinancing Information

Home Loan Information

Mortgage Broker Information

Featured Home Loan Information

Finding the right mortgage broker in Brisbane

So, you've started looking for your new home in Brisbane. You've found a home that you and your family love and now it's time to arrange the finance. If you don't have the time to do all the research from the hundreds of home loan options available yourself, then it may be a good idea to get professional help from a mortgage broker. Here we provide some tips on finding the right mortgage broker in Brisbane.

Home Loan Redraw Facility How Can It Benefit You?

Today, there are many different innovative features available on home loans. Some of these features, including redraw facilities, can help you save money on the total interest costs of your home loan over the term of the loan. Here we look at the redraw facility and how it could benefit you.

Standard variable home loans

Perhaps the most common type of home loan for Australian home owners is the standard variable home loan. The standard variable interest rate home loan calculates interest charges based on the Reserve Bank of Australia's current official interest rates. Standard variable rate home loans offer greater flexibility than the fixed interest rate home loan option. Here we look at some of the advantages of a standard variable home loan.

Adelaide Home Loans and Mortgage Options Reviewed

Looking for a home in Adelaide? Thinking about home loans and finance, but wondering where to start. Our website is hear to assist you in your search for the perfect Adelaide home loan. Our partners are experienced in helping home buyers, just like yourself in finding the best solution available.

Home loans in Darwin

The Top End is booming and likewise Darwin has experienced a huge property boom in recent years. With more and more people moving to the Territory's capital, the choice for home buyers seeking finance has increased greatly. Today, there are many home loan options from both the traditional banks and the newer non bank lenders. While most of us are familiar with the large banks, the non bank lenders are relatively new on the scene. Here we take a look at the non bank lending market in Darwin.