Category: Loan types

July 6, 2020

5 Expert Tips for Finding the Best Home Loan Rate

Are you looking for a home loan to buy a property or simply wanting a different banking relationship? Or maybe you’re concerned that you’re paying more for your mortgage than you should?

It may be a very valuable exercise to ensure that you’re getting the best home loan rates available when it comes to your home loan.

Here are some tips on exploring how to make sure you’re obtaining the best home loan rates.

Make Sure You Are Focused on the Comparison Rate

When comparing home loans, you will notice that you will often be presented with an advertised rate and a comparison rate. The comparison rate is what you want to stay focused on.

An advertised rate is the rate that you will have to pay for your mortgage each month. But it will only show you the value you pay for the interest. The comparison rate takes into consideration any monthly or annual fees and charges that are associated with the home loan package that you are being offered, therefore presenting you with your total effective rate.

Be sure to stay focused on this comparison rate so you can make sure you are getting the best home loan rate.

Joust is a unique service that can help you to discover some of the best home loan comparison rates available. Click here to learn more about how Joust helps you find better home loan rates.

Look For Home Loans Without Fees

Many credit providers will charge monthly or annual fees in exchange for them looking after your home loan account. These fees will increase your monthly repayments and are usually in exchange for a number of features that come packaged with your home loan. However, it is possible to get these features without having to pay the monthly or annual fees. 

Over the entirety of your loan, you can save a significant amount of money.

When looking for a home loan, it’s wise to look for options that don’t involve monthly or annual fees.

Understand the Difference Between Variable and Fixed Rates

There are two broad types of home loans that lenders offer: fixed or variable rates.

It’s important to understand the difference between these two rates, as they can have a significant impact on your home loan repayments and costs.

A fixed rate home loan means that you will pay the bank exactly the same amount every month and your interest rate will not change for the fixed rate period.

Conversely, variable rate home loans may change several times over the course of the loan. This means that if the interest rate goes up, you will be paying more. However, this also means that if the interest rates go down, then you will be paying less.

Take some time to determine which of these two options will work best for you and your situation.

Don’t Hesitate to Switch

You can move your home loan to another lender to get a better rate. A lot of people don’t do this because they think they can’t, or they believe it is too much hassle.

However, if you can get a better rate at a different credit provider, then it can be worth the time.

It is important to note the fees your current provider will charge for discharging your home loan. Check these out in full before you agree to move your home loan.

It is actually becoming increasingly easy to move your home loan.

Interest rate break costs only apply to fixed rate loans. The costs associated with discharging variable rate loans are typically between $300-$500. You can find more information about this in your original mortgage agreement.

Use a Home Loan Calculator

Finding a better home loan rate can be very exciting. You can compare rates in order to calculate the potential savings. Using a home loan calculator or online service can help you with this.

Joust is a very useful tool to use when looking for a better home loan rate. Joust will use your basic information in order to get lenders to fight over you and bid with some of the best home loan rates available. Lenders on Joust can only bid if their comparison rate is lower than the current best bid, thus making sure you end up with maxiumum competitive tension and potentially a lower home loan rate than your current bank has provided.

The most important thing to remember is that lenders are all in competition with each other and may want to really fight hard for your business.

If you feel like you aren’t being given the best rate available by your current bank then take our tip and shop around.