Before you sign on the bottom line of any loan contract, you should be really clear on what the loan will cost and what features are included.
Here are some questions to ask your broker or lender before you pick up a pen.
To help borrowers compare different loans and lenders, the government requires all lenders to publish a 'Comparison Rate' (also known as the AAPR, or average annual percentage rate) alongside the headline rate on any material promoting home loans.
The comparison rate helps borrowers get a better indication of the cost of a loan over the long term. It's calculated using a standard formula that takes into account:
While the comparison rate can give you a good idea of the true cost of the loan, you should also consider money-saving features that may help you reduce the cost of your loan over the loan term.
Utilising features such as redraw, direct debit, and flexible repayment may make a huge difference to the overall cost and convenience of the loan.
So remember to ask:
The comparison rate does not cover all the fees and charges associated with a loan.
Potential costs that the comparison rate does not account for includes:
Ask about the costs of all these things and consider how likely it is that you'll use these features.
Continue to information about finding your property.
Aussie does not provide any financial or investment advice. This document has been prepared as a factual guide only. It does not take account of your objectives, financial situation or needs. Aussie recommends that you seek independent financial advice and obtain your own professional legal and taxation advice before making an investment decision.