Most common home loans

Construction home loans

Many people opt for building a house of their own to suit their tastes rather than buying a ready made house. Residential or investment property construction can get up to 90% of its estimated value as loans. This loan is given against the land and building contract value.

First home Owner

The First Home Owners Grant (FHOG) is given to borrowers who are first time owners of residential property. This grant can be used for costs like fees and other expenses connected with buying a first house. Many financial institutions require proof of 3-5% savings as deposit before granting the loan. Thus FHOG can be utilized as deposit.

Fixed rate home loans

The rate of interest can be fixed for a period of 1-10 years on your home loan.  By choosing to get a fixed rate of interest there is no need for worry over increasing interest rates. There is provision for locking the rate during the application process. This might have a fee but it is worth the trouble. During the period of fixed rate it might not be possible to make extra payments towards the home loan.

Variable Rate of Home Loans

Interest rates are varying all the time. It depends on the economic climate of the country. A home loan with a variable rate is a standard mortgage which has an interest rate that varied according to the market economy. Thus the periodic payments and the rates of interest vary a great deal over the period of the loan. Thus reductions of both the principle and interest are possible at every individual repayment. The advantage of this is that huge amounts can be occasionally paid to the loan without the incurrence of penalties.

Home loans for bad credit ratings

Financial trouble is not new in many families. There are occasional financial troubles everywhere. There is help for people who have bad credit ratings and payment defaults. The non conforming market provides up to 95% of value of property as loan. There is also provision for refinancing and other home loans. The non conforming loans help you get back good credit scores by prompt repayments. With the establishment of a good credit history you can again enter prime loan market.

No Deposit Home Loan

Stable employment and no lapses in credit history, qualifies you for a 100% home loan. This loan enables immediate realization of dreams. Earning equity on the house is quicker in this type of loan since repayments would be done on time. These loans require no deposits and hence time and money can be saved.

Home loans with offset accounts

In this type of loans your savings account is tied up with the home loan account so that your savings would reduce interest amount on the loan. Thus there is savings on the interest without tying up of your savings. This is an offset account. The money can be used for other purposes as well.
Home loans with redraw facilities

Some lenders have the provision of redraw. This happens when there have been excess payments made to the home loan. The term for this varies with the lender.