Your selected home loans
Owner Occupier, LVR <80%
Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.
Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.
Read our Mozo Review to learn more about the Unloan Unloan Variable
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70-80% LVR, Investment, Interest Only
Competitive rate tiers for investors only. Leverage the equity you have built up for a lower interest rate. Enjoy a super-fast application process. Split up to 10 loans against your property. Optional offset accounts. Unlimited fee-free transactions. Interest only option.
Competitive rate tiers for investors only. Leverage the equity you have built up for a lower interest rate. Enjoy a super-fast application process. Split up to 10 loans against your property. Optional offset accounts. Unlimited fee-free transactions. Interest only option.
Read our Mozo Review to learn more about the Athena Fixed Home loan
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Owner Occupier
Competitive variable interest rate. No establishment or ongoing monthly fees to pay. Optional offset account available for 0.10%. Unlimited redraws. Extra repayments allowed. No minimum loan amount.
Competitive variable interest rate. No establishment or ongoing monthly fees to pay. Optional offset account available for 0.10%. Unlimited redraws. Extra repayments allowed. No minimum loan amount.
Read our Mozo Review to learn more about the G&C Mutual Bank Choice Home Loan
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Owner Occupier, Interest Only, LVR <80%
Read our Mozo Review to learn more about the Great Southern Bank Basic Variable
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Advantage Plus, Owner Occupier, Interest Only, LVR >90%
Read our Mozo Review to learn more about the Unity Bank First Home Buyer Variable Home Loan
Your selected home loans
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When it comes to taking out a home loan, you have plenty of choice to make. One of the key ones is what type of mortgage repayments you'd like to make. For this, you have two basic options:
For some borrowers, going interest-only for a set period of time is a convenient way to ease themselves into the loan by initially making lower repayments.
During the interest-free period, mortgage borrowers will only be required to pay off the ‘interest’ part of the loan, rather than both the interest and the loan principal (i.e. the loan amount that was borrowed).
Interest-only mortgages aren’t without their drawbacks though, as they may well prove a more expensive option over the long-run.
There are a few key advantages to paying interest-only for a while.
There are a few downsides to taking out an interest-free home loan.
Mortgage lenders tend to charge higher interest rates on interest-only home loans than they do on principal and interest loans. (See more in our home loans statistics page).
That means that if you are thinking about taking out an interest-only home loan, the high interest rate you’ll likely need to pay will be an important factor to weigh up when it comes to calculating your overall costs.
This rate premium also exists on investment home loans, though it’s much smaller.
This rate increase also highlights the importance of shopping around. A 1% difference in interest rates can equal hundreds of dollars more a year and tens of thousands over the life of your loan.
You can start comparing interest-free home loan rates yourself by checking out our handy comparison table above, or by plugging in your desired loan amount and loan term at the top of that table to view the monthly repayments required on different home loan offers.
Crunch your home loan costs, for free! See more
When you take out a home loan the amount you borrow is known as the ‘principal’ while ‘interest’ is the amount you’re charged by a lender to take out the loan. Your interest is determined by the interest rate.
When you make principal and interest repayments, you’re paying back both of those costs.
When making interest-only repayments, you’re only paying off the interest on your loan, meaning your principal remains the same.
If you’re experiencing financial hardship or you’re looking to reduce the size of the mortgage repayments you’re making on your mortgage, you may have the option of refinancing to interest-only repayments for a fixed period of time (depending on your lender and loan).
This isn’t as easy as clicking a button though, as you’ll likely need to apply online or contact your lender first to get the process started and find out if you’re eligible.
Interest-only loans tend to be more expensive than principal and interest loans for both owner-occupiers and investors.
That’s because, on average, lenders charge higher interest rates on these loans, so borrowers will typically pay more interest over the entire life of the loan.
Once your interest-only repayment period comes to an end, you’ll be required to start making principal and interest repayments, unless you negotiate for an extension with your lender.
Remember, principal and interest repayments will likely be much higher than you’re used to paying, so it may be worth getting your budget in order ahead of time.
Lenders will only allow borrowers to make interest-only payments on their mortgage for a set amount of time. After all, they want you to repay the loan eventually.
Typically, lenders allow customers to go interest-only for up to five years, though this can be as long as ten years in some cases.
Interest-only home loans may be a more popular option with property investors, particularly with the potential tax concessions on offer, but there are still plenty of loans available to owner occupiers as well. In fact, you can see for yourself in the comparison table at the top of this page.
Learn what you need to know about mortgages and money management in our helpful guides. See all
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The representative is the reason for the positive review. Rebecca Wickham at BCU was attentive and patient.
Read full reviewThe representative is the reason for the positive review. Rebecca Wickham at BCU was attentive and patient.
FLEXIBLE AND ACCESSIBLE
Read full reviewFLEXIBLE AND ACCESSIBLE
I have banked with all the major banks and a few smaller and by far Westpac is the best
Read full reviewI have banked with all the major banks and a few smaller and by far Westpac is the best
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