Cheapest Flexible Home Loans
Who said that you had to compromise on features if you want rock-bottom prices? All six placegetters here offer both redraw and offset. While both essentially do the same – reduce the amount of interest you pay – the offset facility offers more. The ability to link your loan to a transaction account, so every dollar you have in this transaction account “offsets” your debt, can mean big savings with little pain. Once again Pacific Mort
gage Group (PMG) shows the strength of non-banks in today’s market, coming up No. 1 as the cheapest flexible home loan for the third consecutive year. Its standard variable loan offers free unlimited redraw transactions and, as with most home loans, unlimited extra repayments are allowed.
However, it’s worth noting that depending on what type of loan you have, some lenders limit the frequency of repayments to just fortnightly or monthly. (See canstar.com.au for a list of which lenders allow weekly, fortnightly and/or monthly repayments.) An annual fee of $120 is charged on settlement but PMG then rebates the fee on an ongoing annual basis.
ING’s Orange Advantage
home loan picks up the top spot for banks. Its 3.79% rate is reserved for customers who have a 20% deposit and borrow between $150,000 and $500,000. If your mortgage is a little more you’ll be able to shave 0.1% off that rate. Borrow more than 90%, though, and your rate jumps up to 4.75%.
The home loan is linked to a transaction account (Orange Everyday) where you can access your money using a Visa debit card. Orange Everyday customers have long enjoyed fee-free withdrawals from any ATM in Australia and finally the big four banks dropped “foreign” ATM fees this year. It will be interesting to see how long they take to follow ING in removing global ATM fees.
Orange Everyday account holders pay no fees for domestic or global ATM withdrawals, or international transactions made overseas or on international websites, as of November 10, 2017. For more details and eligibility, see page 20.
Other than swapping positions, the placegetters in the non-bank category were the same as last year. This shows that the Cheapest Flexible Home Loan winners are a fairly consistent bunch.