Identify The Benefits Of Australia Home Loans

By Guy Baldwin

Home loans are loans acquired for the purpose of buying real estate properties. Home loans could be taken by first home owners, residential home owners, and property investors. They are referred to as home mortgages as well.

In Australia and New Zealand, Australian home loans date back to the early years of 1911 a period when it was introduced to them by their trans-Tasman neighbors. Laws and systems of lending have changed a lot with time leading to new borrowing and lending policies. Loans that are standard and variable are referred to as home loan product and they are very flexible.

Quite a wide range of Home loan products are offered to accommodate different situational needs. These include basic valuable loans, standard variable loans, fixed rate loan, combine rate loan, and home equity loans to mention a few.

Basic valuable loans are designed to have low interest rates and include very few features as compared to other alternatives. They are greatly flexible and are best suited for borrowers who are no frill loans. The Standard Variable Loan is a common home loan product which is very flexible. It includes the features that enable the borrower to split the loan, remove loan re-draws and make extra payments.

The fixed rate loan allows the customer to service the loan within a given period of time. This period ranges between one and two years. Once the term expires, the loan reverts to a variable rate or can be renegotiated for another fixed term. The interest rates are locked in to protect against rising interest rates.

Combination rate loans are loans that combine features of both the fixed and variable loans. This is done when a flexible rate is applied on a loan portion and the fixed rate is also applied on the balance. This makes the buyers benefit when there is a drop in interest rates and at the same time protects the buyer when there is an increase in loan interest rates.

A buyer can have an access to equity in their home since there are credit offers to customers in the form of home equity loans. They can later use in home improvements and borrow against his equity at a lower rate. Home equity loans can be generally used for any purpose.

The Australian financial market has revolutionalized greatly making it one of the most competitive both locally and globally. Building societies and credit unions have not been left behind either; they offer all manner of pleasant packages that have drawn a lot of customers onto their side.

Home lenders are offering various packages to the buyers. Home lenders were almost facing collapse in business due to the exodus of buyers and this is due to the fact that big banks are offering low interest rates for the buyers. There are regulations that are now being brought up by the Australian government in protecting the mortgage lenders

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