Your Home Loan, Your Choice

When it comes to choosing the right home loan, the choices are endless and sometimes confusing. Whether you are a first home buyer, looking to upgrade, purchasing your first investment property or are a seasoned investor, JNC Finance has access to over 30 different lenders and a range of home loans to suit everyone.

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We have explained some of the most common home loans for you below.

Contact us to find out how much you can borrow and discuss which home loan is right for you!

Standard Variable Rate Home Loan

Standard Variable Rate loans are the most popular home loans in Australia. They offer you the most flexibility and normally come with the most features. The interest rate on these loans will move up and down depending on the official interest rate fluctuations. This is the ideal loan for the borrower who wishes to pay off their loan quicker. Many Lenders will offer discounts to the interest rate depending on the total loan amount.

Basic Variable Rate Home Loan

Basic Variable Rate loans offer a lower interest rate. They also lack many of the features of a Standard Variable rate loan. The interest rate will move up and down depending on the official interest rate fluctuations. These loans are sometimes referred to as the "No Frills" loans. These loans have much less flexibility.

Fixed Rate Home Loan

Fixed Rate loans will protect you against future interest rate changes for an agreed time, normally anywhere between one and ten years. However you also won't benefit if the rates go down during the period your loan is fixed. there are also normally limits on the amount of extra repayments that may be made during the fixed period. These loans normally revert to the Standard Variable Rate at the end of the fixed period unless "rolled over" into another fixed rate term.

Combination or Split Home Loans

Combination or Split loans allow the borrower to have the flexibility of a variable with the certainty of a fixed rate. How you split the loan is entirely up to you, normally a 50/50 or 60/40 split is the most common. You still get the benefits of additional payments on the variable with the stability of the fixed rate.

Low Documentation Home Loans

Low Documentation Loans are for self-employed people whose financial statements may not be available for many different reasons. These loans require very little or no income documentation to get approval. Normally the Lender's will only lend up to 80% of the value of the property. Under certain circumstances they are available to PAYG persons but normally only up to 60% of the value of the property.

Professional Packages

Most Lenders offer Professional Packages with a discount off of the standard variable rate. You will need to borrow $150,000 or more to qualify. There can be significant savings made if you have multiple loans. These packages will have an annual fee. The application fee is waived as well as monthly fees. You can also qualify for discounts on other financial products such as banking, credit cards and insurance.

Line of Credit Home Loan

Line of Credit or Equity Loans provide the borrower with access to the equity in their home. These loans provide access to funds, when required, up to the original limit set. The minimum repayment due each month is the interest charged. Some lenders require that principal reductions be made after a certain period of time. A customer can generally access their Line of Credit via a Cheque Book, Credit Card, ATM, Phone and Internet. You can have your salary paid directly into the loan account and you can access the balance of the loan at any time.

Introductory or Honeymoon Home Loan

Introductory or Honeymoon home loans offer customers a special reduced rate for an introductory period, often one year. After this most interest rates will revert to the Standard Variable Rate. The rate may be fixed, variable or capped, meaning that if the interest rates rise your rate will not go up, but if rates fall they will go down. An Introductory Loan is attractive for the borrower wishing to reduce the principal quickly by making extra payments. The main disadvantage is that most banks charge penalties if you discharge these types of loans within the first 3-4 years after settlement.

No Deposit Home Loan

Normally you would need to have saved a minimum of 5% deposit plus costs. A No Deposit loan will lend you up to 100% of the property purchase price. This allows you to purchase sooner instead of waiting to save a larger deposit. Generally the banks have a higher standard for these loans, i.e. suitable employment by the applicants and a suitable property/location being bought. This type of loan is available for both new and established homes.

Credit Impaired/Non Conforming Home Loan

So called 'non-conforming' finance refers to loans that cater for those who can't meet the standard income verification and credit history criteria mainstream lenders like banks and mortgage originators use for ordinary borrowers. Such borrowers include those who are self-employed, have a poor credit record or who have recently arrived in Australia. Non-conforming loans are usually at higher interest rates to reflect higher risk of these borrowers. the Non-conforming finance is also called 'sub-prime lending'.

All-In-One/Mortgage Offset Home Loan

All-In-One Loans are essentially a transaction account and a home loan combined. Thy allow you to directly credit your salary or other income to the account and then withdraw your funds va ATM, EFTPOS, linked credit card or cheque book, as you need it. The major benefit of an All-In-One/Mortgage Offset loan are that it enables you to decrease your interest charges by keeping your funds in the account for as long as possible. You must pay attention not to withdraw more than you deposited in the first place.

Family Pledge Home Loan

Most of the banks now offer the ability for a family member (generally the applicant's parents) to pledge their support to assist with a loan application. This maybe by way of additional security, serviceability or both. Typically, the provision of additional security may alleviate the need to have Lenders Mortgage Insurance on the loan, and could save $000's. The banks have a range of policies, in regard to whether first or second mortgages are acceptable security, whether the family member needs to be able to show they can service the debt they are offering to support.

Bridging Home Loan

This is a temporary loan which allows the buyer to complete the purchase of a new property before selling their existing property. It is also useful for borrowers who want to finance the building of a new home while still living in the old one. The main advantage a Bridging loan is its quick and you can get the money you need in order to move ahead with the purchase of your new home. You can set repayments up in many different ways; interest only, no repayments, fixed amount or normal principal and interest.