Today in Australia there are hundreds of different home loan products on the market from a large panel of financial institutions. All offering many different features, fees and rates and competitions is fierce and new home products are available nearly every day. Using a mortgage broker is now an essential part of scouring the market for the right home loan. Below are some of the different types of loans that are on offer and a Hall Mortgage Consultant can help you to choose the right home loan product that best suits you.

This loan has a low special interest rate for the first part of your loan contact to assist with lower repayments at the start, usually only for six to twelve months. It can be either fixed or variable and generally reverts to the standard variable rate. These types of loans can also help you reduce the principle if you make additional payments during the honeymoon period. The main disadvantage is that most banks charge penalties if you discharge these loans within the first three to five years, so this needs to factored in.

Standard Variable Loan

Traditionally the most popular type of loan and rates will vary depending on the market and economic conditions at the time. The interest rate can vary throughout the term of the loan usually 25 to 40 years, so if rates go up or down, so will your repayments. This type of loan is traditionally the most flexible and includes additional features such as an offset account and the ability to make extra repayments, to redraw funds ( if extra repayments are made ) or to split your loan.

Basic Variable Loan

Similar to the Standard Variable with a lower interest rate, but less features, such as no offset or portability etc. These are popular with people who are budget conscious and don’t need the extra features. The interest rate can still go up or down depending on the market.  

Fixed Rate Loan

Fixed Rate loans can offer you a set term and interest rate which will generally range from 6 months to 10 years. Fixed rate loans may appeal to borrowers who like to keep a set budget, as you can be certain of your home loan repayments for the fixed period and therefore have peace of mind with their repayments. Rates are not affected if the Reserve Bank increase interest rates, but also they do not go down if the interest rates fall. Fixing an interest rate does mean a trade off in respect of some of the flexibility of a loan. A fixed rate loan generally has more restrictions then a standard variable. Many fixed rate loans do not let you make extra repayments or restrict the additional repayments during the fixed period. Fixed rate home loans can also be combined with variable rate products to gain the best of both worlds; a variable rate loan for flexibility and a fixed rate loan for security.


100% Offset Account

Your 100% Offset Account is a fully transactional account that is linked to your home loan account with the interest rate on your offset account the same as that applied to your loan account. The offset balance accrues interest at the loan rate and reduces the interest payable on the loan. The balance that you have in your offset account is deducted from your loan account therefore lowering the amount of interest you are charged, but this in turn increase the amount of principle that is being repaid ( as repayment amount remains unchanged). The aim is to try and maintain as much as possible in your offset account, as interest is calculated daily and charged monthly in arrears. The balance in the account is offset against your loan. The more money you keep in your account, the faster your loan is reduced. Offset accounts also work well for people who are saving for holidays etc or have regular payments ( ie GST payments) that need to be paid and they can make use of the money until required to help them pay their home off quicker.

For Example:

The Balance of your Home loan is $300,000 and you have $10,000 in your offset account. Interest is only calculated on the difference between these amount ie. $280,000. Your repayment remains the same, but this extra money reduces the principle and therefore assists you to own your home faster. Please talk to a Hall Mortgage Consultant to help you grasp this concept.

Split Loans  

Split Loans can give you flexibility by have a portion of your loan fixed and the rest on a standard variable rate. This gives you peace of mind on the fixed portion if there is a rate rise and the amount you fix is up to you with the flexibility of a variable rate.

Loan with a redraw facility

A redraw facility with your loan enables you to put extra money into your loan. You can also take the money back out again, if you need it. The extra payments can reduce your interest payments and this in turn can reduce the loan life. This type of loan is good for people who pay GST quarterly as they can withdraw this out when GST is to be paid.

Line of credit

A Line of Credit gives you increased flexibility with your loan and works like a large Credit Card. You only pay interest on the amount of credit you use and this means your repayments can fluctuate each month. To work best you put all your income into the line of credit and utilise a credit card to pay your monthly bills and then the card is cleared each month. Therefore the extra money kept in the account helps reduce the loan amount and the interest paid and assists in paying you loan off sooner. Interest rates a usually higher for this increase in flexibility and these loans suit people who can budget.

Family Equity

The Family Equity allows family members with equity in their own property, to help family members bridge the deposit gap and cover up front borrowing expenses, by providing a limited guarantee in support of loan application for first home buyers. They will be able to maximise the amount they can borrow against their own security, i.e. the purchase property, with this additional limited guarantee from a family member. The guarantee is to be supported by a registered first mortgage over the family member's property or possible a registered second mortgage. These loans have the added bonus of reducing the Loan to Value Ratio, meaning that borrowers can dramatically reduce, or even avoid, paying mortgage insurance. The Family Member will be guaranteeing the total loan amount, however if they wish to limit the amount of their support they may apply for a loan in their own name/s and provide the loan proceeds to the family member. The Family Equity utilizes the guarantor’s policy and they can provide just security or security & servicing support

Homeseeker Pre Approval

This facility provides applicants with confirmation that they are eligible for a loan of a certain amount prior to a specific property being selected. The Lenders usual terms and conditions will apply to the loan including the property meeting the Lenders usual security requirements and all information supplied is correct. Allows customers to know how much finance is available when considering purchasing a residential property. May mean a faster final approval if details have not changed from the original application.

No Deposit / 100% Home Loan

No-deposit home loans allow you to borrow the full amount of capital needed to purchase your house, without the usually required deposit of at least five per cent. No deposit requires you to have a good credit history and income, and allow you to buy property even though you haven’t saved a deposit. They generally have stricter criteria and guidelines for approval.

Interest Only Loans

Interest only home loans are mostly utilised by investors who are not concerned about paying their loan off quickly. When making interest only payments, the initial home loan balance stays the same as there is no reduction of the principal. The home loan reverts to principal and interest at the end of the fixed term. Generally interest only loans are not suitable for owner occupier home buyers as making interest only payment does not assist in building equity in the home. However, owner occupiers may choose to utilise the interest only option in times when they may be experiencing financial difficulty, to help them get through a short term problem.

Construction

Clients building a new home? Lenders offers construction loans on a wide range of products and will lend up to 97% LVR. To commence with a construction loan you will need to provide a contract for the purchase of the vacant land, a fixed price contract for the construction and also council approved plans to determine the full cost to complete your home. The lender will then look to approve your home loan based on the ‘on completion’ value of your home. During the time you are building, the lender will inspect the site prior to making payments to the builder on your behalf. You will only pay interest on the loan amount drawn upon and paid to the builder at each step of construction. On the completion of construction, you will then revert to your standard monthly payments.

Bridging Home Loan ( Relocation Loan )

A bridging loan (or relocation loan) is a short-term loan that covers the gap period between purchasing your new property and selling your old one. If your clients have found a new home before selling their old one, allows them to: take up to 6 months to sell their existing home and when buying a new home. Up to 12 months to sell their existing home when building a new home by using both homes as security to finance the purchase of the new home borrowing up to 85% of the value of both homes. (including the interest that will capitalise on the new loan during the Bridging period). Each lender assesses bridging / relocation loans differently, so it pays to have an expert on your side, like a Hall Mortgage Consultant.

Investment Loan

Investments can take many forms such as shares, property and land and a Hall Mortgage Consultant can help structure your loan to best suit your situation. You can borrow up to 90% of the property's value, pay interest only for one to ten years, then principal and interest for the remaining term.

Reverse Mortgage


These loans have become popular with people over 60 being able to unlock the equity they have built up in their home. They are flexible in allowing a lump sum payment or as the customer requires. You can use these funds as an income stream or for personal lifestyle needs like travel, home improvements etc. The loan accrues interest and fees that is capitalised, which means it's added to the amount of the loan, but no repayments are made until the home is sold or the owners no longer live in the property or are deceased. These loans require you to obtain independent financial and legal advice.

Lo Doc Loan

These loans were established for customers who’s financial records are not up to date, may be self employed or don’t meet normal standard loan criteria. Interest rates and fees can be higher with this type of loans and you must have a clear credit history. Generally lenders require lenders mortgage insurance to be taken out above a 60% lend and may limit loans to 80%. You are required to do a self assessment by completing an asset and liability and stating your annual income on a declaration ( No pay slips are required)

No Doc Loan

These loans are similar to Lo Doc loans, these loans however do not require verification of income. Interest rates and fees are higher than a standard loan.



Non-Conforming Loan

Some people find themselves from time to time with financial problems and non conforming lenders are there to assist you with the ability to obtain finance. You pay a higher interest rate and usually require a minimum of a 10% deposit, but allows you to be in the housing market.

Leasing

We have a number of lenders on our panel who provide specialist services and packages for capital or leasing finance. This allows us to provide finance options for a range of income generating plant and equipment such as: construction, manufacturing, industrial plant & equipment, winery equipment, mining, printing, electronic & computer systems, agricultural and farm machinery.

A Commercial Hire Purchase is a hire agreement between you (the hirer) and the financier for an agreed period. It can be used to finance the purchase of most business assets. The full cost of the goods does not have to be financed. You can use trade-in equity or deposit to reduce the amount financed. At the end of the agreed period a Balloon Payment may remain or facility can be structured so there is no Balloon Payment. The Balloon Payment must be in accordance with lending guidelines.

A Finance Lease is a rental agreement between you (the lessee) and financier (the lessor) for an agreed period. It can be used to finance the purchase of most business assets. The full cost of the goods must be financed. You cannot use any trade-in equity or deposit to reduce the amount leased. At the end of the agreed period a Residual Value remains. The Residual Value must be in accordance with taxation and lending guidelines.

A Rental Agreement is between you (the lessee) and financier (the lessor) for an agreed period. It allows the lessee to gain use of most business assets without purchasing the goods. The full cost of the goods must be rented. You cannot use any trade-in equity or deposit to reduce the amount rented. At the end of the agreed period you must return the goods to us.

A Chattel Mortgage is a loan agreement between you (the borrower) and financier (the lender) for an agreed period. It can be used to finance the purchase of most business assets. The full cost of the goods does not have to be financed. You can use trade-in equity or deposit to reduce the amount financed. At the end of the agreed period a Balloon Payment may remain or facility can be structured so there is no Balloon Payment. The Balloon Payment must be in accordance with lending guidelines.

Our Hall Mortgage Consultants ensure you will receive high quality service and a finance solution structured to your best advantage.

Commercial Loans / Business Loans

Hall Mortgage Consultants have been providing business and commercial loans for a number of years. We have specialist lenders on our panel, so no matter what your need is we can accommodate whether its : commercial property, commercial development, business finance secured by both residential and commercial properties, rural and agricultural land and equipment purchases.

Our Hall Mortgage Consultants can assist with your enquiry.
Commercial loan products have become extremely competitive in recent times. Many institutions now offer retail interest rates for some commercial transactions and others support certain industry sectors and are willing to look very favorably at these niche markets. Business packages now allow small business owners to use their residential security for both business and personal lending needs at a home loan rate. These packages can provide a global limit that can be split into sub accounts such as a home loan, a loan for the business and an everyday overdraft account.

We have had some great success in sourcing competitive commercial loan packages and our Hall Mortgage Consultants would be pleased to assist you.