Home LoanGetting the Best Home Loan Rates in Sydney

April 5, 2024

It’s true that there is a lot to check when looking for the best home loan rate. The number one priority should be avoiding mortgage stress. The consequence of getting a mortgage is serious. While incurring a lot of financial penalties, there is the possibility of losing the house you’ve been paying for and not being permitted to apply for another mortgage for several years. Others have been unaware and unprepared for such a sharp increase when the RBA increased rates to their highest level in more than a decade. This was the reason why a lot of clients rushed to refinance. If you can avoid this scenario, then you’ll sleep much better at night.

The Three Levels of Home Mortgages

  1. Basic Home Mortgage

    Basic home mortgage offers a low interest rate but limited features. This may not be the best option for those who want to make extra repayments and draw on them later because restrictions and fees apply for doing so. Basic loans are simple which means they have very little additional features.

  2. Standard Home Mortgage

    A Standard home mortgage provides more flexibility than a basic loan. It is possible to redraw extra funds paid into the mortgage. There is also a choice to switch to a fixed rate or to divide the loan into being partly fixed and partly variable, or a full offset account is another option.

  3. Package Home Mortgage

    This combines a standard loan with an interest rate discount depending on the mortgage total. This makes it more affordable than many basic loans but package fees may apply but the lender may include a free transaction account or a credit card with no annual fee.

Comparing Home Mortgages

There is a a lot of features to check when comparing home loans in Sydney:

  1. An interest rate is the fee being added for borrowing money from a lender. It is shown as a percentage of the total mortgage amount and of course the goal is to secure the lowest interest rate possible.
  2. Comparison rate includes the interest rate and all the fees and charges associated with the loan being applied for. This shows the true cost of the loan and can be seen as a more accurate interest rate in terms of the cost. The smaller the difference between the comparison and interest rate, the better the deal.
  3. Monthly repayment amount is the money you need to pay to the lender or any financial institution each month.
  4. Annual fees might be charged by the lender if special discounts are offered with your mortgage.
  5. Investigate any additional features which will be beneficial like offset account, additional repayments and repayment holiday. During the pandemic, many banks offered repayment pauses to clients who needed it.

Home Mortgage Fees

  1. Exit fees
    A one time fee that can be collected when a loan is ended before the term ends.
  2. Redraw fees
    Are charged by the lender when the borrower takes money back out which was paid into the mortgage.
  3. Break fees
    A fee that compensates the lender for its loss if the loan is repaid early or the borrower changes the product, interest rate or payment type during a fixed rate loan.
  4. Account-keeping fee
    These are continuous fees that are added to cover the lender’s organisational costs of managing the account of the client.
  5. LMI or Lender’s Mortgage Insurance
  6. Valuation fees
    Cover the cost of property assessment done by a third party channel to assess the value of the property.

Customer Service’s Role on Getting the Best Home Loan Rates in Sydney

Customer service and support provided by the lender is very important when dealing with a home mortgage. Consider the responsiveness, cooperation and professionalism of the lender’s customer service team. Look at online reviews and ratings to have insights into the experiences of other borrowers. A lender with excellent customer service for sure can provide precious guidance and assistance throughout the loan application. Also, it’s crucial to choose a home mortgage provider with a firm reputation and credibility in the market. Research the lender’s background, financial stability and market standing. Check if the lender is licensed and authorised by relevant authorities. A reputable lender inspires confidence and ensures that your financial transactions are secure and transparent.

Factors of a Good Customer Service:

  1. They are precise about the entire application process, one miscommunication with your mortgage company can lead to delays and disappointments.
  2. All the features and options that apply to your financial standing are presented. Lenders should not take a “one-size-fits-all” approach with all their prospect clients.
  3. They should be responsive.
  4. Clients are being guided on application forms.
  5. They ensure that the loan program, rates and terms are understood by their clients.
  6. They should be honest, accountable and well versed in the entire application process and post-sale concerns.

Be mindful about your Credit standing!

When a lender checks your credit report, it triggers hard enquiry. Too many hard enquiries over a short period of time can give banks the impression that your applications are being rejected, which can result in hurting your chances of getting approved. So instead of applying with a lot of lenders in the hopes of finding the best deal, do plenty of research first and hone in on one or two lenders that seem to suit best.

Australian Financial and Mortgage Solutions as a Guide to Get the Best Home Loan Rates in Sydney

Ready to turn your dream home into reality?

Australian Financial and Mortgage Solutions makes sure that finding the best home loan will be easy and accessible. That’s why we’re committed to helping you secure the best home loan rates in Sydney depending on your specific needs and financial goals. Go and reach your real estate goals with us!

Contact Australian Financial and Mortgage Solutions today for a one on one consultation and let our dedicated team of experts guide you towards a more secure financial future.