Choosing the Right Home Loan: Understanding Your Mortgage Options
Finding the Perfect Loan for Your Needs
With hundreds of mortgage options available, selecting the right one can feel overwhelming. Loan type and interest rates vary based on your loan amount, deposit size, and financial goals, making it essential to consult with a qualified mortgage broker.
Here’s a breakdown of five common home loan types to help you make an informed decision.
1. Basic Home Loan
A basic home loan offers:
✅ Low variable interest rates
✅ Few or no regular fees
🚫 Limited flexibility (e.g., restrictions on early repayments)
These loans typically apply to borrowers with loan amounts under $250,000.
💡 Find out if a basic loan suits your needs.
2. Honeymoon Loan or Intro Rate Loan
A honeymoon loan provides a very low introductory interest rate for around 12 months before reverting to a higher standard rate.
Before committing, borrowers should:
✅ Compare long-term costs beyond the honeymoon period
✅ Understand refinancing fees if switching after the intro rate expires
💡 Explore refinancing options to avoid potential rate shocks.
3. Standard Variable Rate Loan
This loan type includes multiple features, such as:
✅ Redraw facility (access extra payments when needed)
✅ Linked credit accounts for easy repayment management
✅ All-in-one account options
These loans are widely used as banks aim to bundle financial services, including credit cards and insurance.
💡 Compare standard variable loans with expert mortgage brokers.
4. Redraw Facility
A redraw facility allows homeowners to make extra loan repayments while maintaining access to those funds.
Before choosing this feature, consider:
✅ Minimum redraw amounts
✅ Potential redraw fees
💡 Find out how redraw facilities works on variable rate loans and how to determine if they suit your needs.
5. No Deposit Home Loan (100% Loan)
A 100% home loan lets borrowers finance the entire purchase price. However:
🔹 Most lenders require 3% genuine savings to cover Lenders Mortgage Insurance (LMI).
🔹 Borrowers must also cover additional home-buying costs separately.
💡 See if a 100% loan is right for you with expert guidance.
Which Mortgage Option Is Right for You?
These loan types barely scratch the surface of what’s available. To make an informed decision, consulting a mortgage expert can help you explore loan features that best match your financial situation.
✅ Compare home loan options
✅ Get tailored mortgage strategies
✅ Secure the best rates & terms
Read our blog post on genuine savings here
📞 Contact CBM Mortgages today to find the best mortgage solution for you!
Written by Craig McDonald 12/06/2025
