#### Contents 1. [Types of loan providers](#types-of-loan-providers-2) - [Banks](#banks-3) - [Non-bank lenders](#nonbank-lenders-3) 2. [What to consider when you compare home loans](#what-to-consider-when-you-compare-home-loans-2) - [Eligibility](#eligibility-3) - [Loan purpose](#loan-purpose-3) - [Loan repayment type](#loan-repayment-type-3) - [Initial deposit amount](#initial-deposit-amount-3) - [Interest rate and type](#interest-rate-and-type-3) - [Loan features](#loan-features-3) - [Loan term](#loan-term-3) - [Fees](#fees-3) - [Comparing loan providers](#comparing-loan-providers-3) ![A man at a desk handing over a house key to someone filling out paperwork. There's also a model of a house on the desk.](https://cdn.productreview.com.au/resize/article-image/5ea4cda4-e002-41b3-bb53-50d601dcaa00?width=826) ## Types of loan providers ### Banks The Big Four banks - that is, [Commonwealth Bank](https://www.productreview.com.au/listings/commonwealth-bank-home-loans), [NAB](https://www.productreview.com.au/listings/nab-home-loans), [Westpac](https://www.productreview.com.au/listings/westpac), and [ANZ](https://www.productreview.com.au/listings/anz-bank-home-loans) - dominate the home loan market. There are also plenty of smaller, more local banks (think banks like [Bendigo Bank](https://www.productreview.com.au/listings/bendigo-bank-home-loan) and [ING](https://www.productreview.com.au/listings/ing-direct-home-loans)) that offer a variety of home loans - so do some international banks that operate in Australia. Have extensive customer service teams. Have branches and ATMs that you can visit. Offer plenty of loan options. Can be easier to access, particularly if you stick with the same bank that you already hold an account with. Can do online banking and use mobile apps to track your loan. Usually don’t offer the lowest rates (although they’re still low enough to remain competitive). Service is often slower and less personalised, as they’re such big institutions. Overheads may be more expensive, meaning higher fees. ### Non-bank lenders Non-bank lenders are those which don’t hold a banking license - they’re not a bank, a building society, or a credit union. These lenders still have to follow the same laws, rules and regulations as banks, so they’re still as safe to use as traditional banks. Online lenders - such as [Lendi](https://www.productreview.com.au/listings/lendi), [Athena Home Loans](https://www.productreview.com.au/listings/athena), and [Tic:Toc Home Loans](https://www.productreview.com.au/listings/tictoc-home-loans) - fall into this category, and are on the rise thanks to the convenience and competitive rates they offer. Often more likely to offer lower set-up and ongoing fees, as they have less bells and whistles than banks. Have more competitive interest rates. Often offer more personalised customer service. Usually more likely to be able to service higher-risk borrowers. Shorter turnaround times, as they’re less bureaucratic than banks. Convenient, as you can often do the whole home loan process online. May service less areas than traditional banks. Can be more vulnerable to economic conditions, such as financial crises. Offer a smaller variety of products, so you may not find something that suits your needs. Limited physical presence and branches means it may be difficult to get face-to-face help. Can be difficult for people who aren’t tech-literate to do the whole home loan process online. #### Is it worth getting a mortgage broker? If you’re having difficulty comparing loans and lenders, then a [**mortgage broker**](https://www.productreview.com.au/c/home-loans?95205a47-a3e3-44da-ae0b-830feb79331b%5B0%5D=313a957f-1441-4d2e-a994-17e3ab9ddc9b) may be able to help you find the right loan for you. This is a licensed professional who brings borrowers and lenders together, and helps you apply for the loan and assist you throughout the process through to settlement. Often home loan brokers are paid commission by lenders, so you don’t have to pay for their services. They may however be offered incentives by a lender to offer you certain loans, which could influence which loans they recommend to you. ## What to consider when you compare home loans ### Eligibility Different lenders have different eligibility criteria for taking out a home loan, so ensure that you check the requirements of each lender you’re considering so that you don’t waste your time with a lengthy application process. Depending on your situation, you may also be eligible for a government incentive, such as the [First Home Owner Grant](https://www.firsthome.gov.au/) - this grant requires that you move into your new home within 12 months, and live in it for at least 6 months. ### Loan purpose You should ensure that the type of loan you’re taking out is the right option for your loan purpose, depending on whether you’re a first-time home buyer, refinancing your mortgage, buying an investment property, looking for a construction loan, or something else. A construction loan, for example, differs from a regular home loan in that it progressively lets you access money as you complete different phases of your home’s construction. ### Loan repayment type There are 2 ways to repay your loan: with principle and interest repayments, or with interest-only repayments. #### Principal and interest repayments Most Australians get this type of loan. With this loan, you make regular repayments on the principal (the amount borrowed), and you pay interest on that amount. These generally have a lower interest rate than interest-only loans, and you’ll usually own your home sooner. #### Interest-only repayments For interest-only home loans, you only make repayments on the interest on the amount borrowed for an initial period of time. Because you’re not making repayments on the principal, your debt doesn’t reduce. While your mortgage repayments might be lower during the interest-only period, they’ll increase after that, so you have to ensure that you can afford this. ### Initial deposit amount When you take out a loan, you’ll have to make a home loan deposit, which is usually at least 10 to 20% of the purchase price. While most lenders require a deposit of 20%, some will allow low deposit home loans, but you’ll likely have to pay Lender’s Mortgage Insurance (LMI) - this protects the lender against any losses in the event that you’re unable to repay your loan. However, first home buyers may be able to buy a property with as little as a 5% deposit home loan without forking out for LMI under the [Australian Government’s First Home Loan Deposit Scheme](https://www.nhfic.gov.au/what-we-do/support-to-buy-a-home/first-home-loan-deposit-scheme/). A higher deposit means you borrow less (as you have a lower loan amount) and pay less interest over the life of the loan. You might also be able to score better home loan interest rate deals that can mean even more savings in your pocket. ### Interest rate and type It’s recommended to aim for the lowest possible interest rate on your loan, as even small differences between these mortgage rates can wind up saving you thousands over the loan. When taking out a home loan, you can choose between a fixed rate or a variable rate. #### Fixed home loan rates Fixed rate home loans have an interest rate that stays the same for a set period of time (for example, 5 years). The interest rate then turns into a variable rate. Budgeting and planning for your loan is easier and more accurate as you know how much your repayments will be. Have fewer loan features, which could mean you pay less. If interest rates go down, you won’t reap the benefits of a fixed interest rate. If you want to change loans down the track, you may be charged a break fee. #### Variable home loan rates A variable interest rate in a housing loan can fluctuate depending on changes in the market. Can give you more flexibility as they have more loan features. If you find a better deal elsewhere, it’s often easier to switch. Budgeting is more difficult, as your repayment amounts can fluctuate. Having more loan features can cost more. If you’re not leaning towards either of these, you can also get a partially-fixed rate, or a split loan. This means that part of your loan (you can decide how to split it) has a fixed rate and the remainder has a variable rate. #### Budget better by knowing your monthly repayment Your monthly repayment is a figure that represents how much you have to pay each month on a loan. This helps you know exactly what you’re signing up for, so you’re not stretched too thin, or conversely, not paying less than what you can afford. If it suits you better, you can also calculate your weekly or fortnightly repayment. ### Loan features Some loans have extra features that can give you greater flexibility in how you access and use them. However, these features usually come at a higher cost, so you should weigh up your options to see if you’ll use them in a way that makes the higher price worth it. - **Offset account:** This is a transaction account that’s linked to your home loan. The balance of this account can be offset against what you owe on your home loan. - **Extra repayments:** A loan that lets you make extra repayments lets you pay off your loan faster, saving you in paying interest. Most variable rate loans allow this, while some fixed rate loans limit how much extra you can repay. - **Redraw facility:** This lets you withdraw any extra payments you’ve made on your loan, which can be useful for emergencies. Your lender may charge a redraw fee or restrict how much money you can redraw. - **Portability:** With a portable home loan, you can sell your home and purchase a new one with the same home loan, without needing to refinance. - **Line of credit:** A line of credit home loan lets you borrow some of the built-up equity in your home. You can withdraw up to a certain amount (the credit limit) determined by your lender. ### Loan term The loan term refers to the length of time you have to pay off your loan. A typical loan term is 30 years, although depending on your situation, you can also find terms ranging from around 20 to 40 years. It’s generally recommended to get the shortest loan term that you can afford - you’ll have to make higher home loan repayments, but you’ll pay less interest, saving you more in the long run. ### Fees You should read the fine print to figure out all the fees associated with your home loan, so you’re not surprised with a large sum down the track. Usually you’ll have to pay an application fee (also called an establishment, up-front, or set-up fee), which is a one-off payment that you pay when starting your loan. You’ll probably also have to pay ongoing fees, such as service fees that are charged periodically (usually monthly or yearly) to a lender for administering your loan. #### Find the comparison rate to know exactly what you’re paying The comparison rate of a loan is the sum that indicates the cost of the loan, including the interest rate and most fees. This includes all upfront and ongoing costs, so you’ll get a good idea of how much you’ll be forking out over your loan. If you’re tossing up between a few different loans, this figure can help make choosing between your options easier. ### Comparing loan providers When comparing providers, you should also look into the following: - **The application process.** The application process should be relatively simple, and should suit your needs. For example, if you need to organise a loan quickly, then you may want to opt for an online lender who can offer faster results. - **The transparency of the lender.** A lender should be upfront with you with all information relating to your loan, whether it’s positive or negative. - **The lender’s customer service.** Your home loan doesn’t end after you’ve finished your application, which is why timely, helpful customer service is important to make things as easy as they possibly can be for you. Reading online reviews can help you determine the overall experience and quality of care a lender can give you, as well give you an indication of how straightforward the application process is. ### The bottom line You should be realistic about how much you can borrow. Take into account rising interest rates that could mean increased loan repayments for you - giving yourself a bit of breathing room, and considering how your personal and financial circumstances could change should help you find a loan that’s right for you. Disclaimer: The information on this website is for general information only. It should not be taken as constituting professional advice from the website owner - ProductReview.com.au. ProductReview.com.au is not a financial adviser. You should consider seeking independent legal, financial, taxation or other advice to check how the website information relates to your unique circumstances. ProductReview.com.au is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by use of this website. { "@context": "https://schema.org", "@type": "Article", "mainEntityOfPage": { "@type": "WebPage", "@id": "https://www.productreview.com.au/c/home-loans" }, "headline": "Best Home Loans", "description": "This guide will help you know what to look for in a home loan and lender, so you can get the keys to your dream place.", "image": "https://cdn.productreview.com.au/resize/article-image/5ea4cda4-e002-41b3-bb53-50d601dcaa00", "author": { "@type": "Person", "name": "Clara Von Dinklage" }, "publisher": { "@type": "Organization", "name": "ProductReview.com.au", "logo": { "@type": "ImageObject", "url": "https://cdn.productreview.com.au/assets/public/og_logo_1a8a64.png" } }, "datePublished": "2021-06-28", "dateModified": "2024-04-10" }

Best Pepper Money Home Loans in Australian Capital Territory Canberra–Queanbeyan

Aussie Home Loans 🏆 2026

Pepper Money Home Loans

Aussie Home Loans 🏆 2026