Home Loan Rate Comparison

Home loan rate comparison is a tool that helps home buyers to identify the true cost of a home loan. It’s referred to as a comparison rate because it factors in the fees, interest rate and other charges and gives the buyer a single rate that can be used to compare loans from different lenders on an apple to apple basis. This was introduced by the Australian government across all states and made mandatory on July 1 2013 making it a requirement for all lenders to display this rate alongside their advertised rate.

What are some of the factors affecting comparison rate?

When calculating comparison rates, a number of factors go into consideration. These includes:

The loan termThe amount of loan to be borrowedThe interest rateThe repayment periodCharges and fees

Some of the factors that are not included in the comparison rate include:

Government charges such as mortgage registration fees or stamp dutyCharges and fees associated with events or loan options that may not be used by the borrower such as redraw fees or early repayment.Cost savings such as arrangements to offset interest which may eventually influence the cost of loan.Some other charges and fees which may not be available at the time the comparison rate is being set.

Why is it important to have a comparison rate?

Shopping for an ideal home loan can be compared to shopping for a good pair of shoes. This is one of the main reasons why the comparison rate is an essential tool to have when you are looking for a home loan. We use the pair of shoe comparison in this case because the two share some commonalities, just like shoes, as a home buyer, one needs a home loan that suits their personal preferences, budget and lifestyle.

If you are shopping for a home loan and do not have the time to walk from lender to lender or making numerous phone calls to get quotes, using a home loan calculator Australia can help not only save time, but also gives you a chance to compare different home loan products from Australia at the comfort of your home on an apple to apple basis. You may also opt for the services of a mortgage broker who will do the comparisons for you, and depending on your needs, he or she will present you with tailored products from various lenders to choose from. Not sure which mortgage broker to talk to, give us a call today!

Kimberley A is an expert property adviser and professional from North Sydney, Australia. The author loves to share her experience on the topics like home loan rate comparison, types of home loans, big lenders, how to get loans approved, etc. so that latest property and home loan updates can be made available for the buyers before making any deal.Trivandrum Directory is a leading website today. Electronics and Communications is another website.

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