Busting the major myths about home loans
These myths have a habit of working their way into our thinking, which is not especially helpful for homebuyers already making big decisions.
Myth: It’s never worth refinancing because exit costs are too high
There are good reasons to refinance and they are all aimed at saving money. Finding a lower interest rate is a common refinancing goal. If your lender cannot match or compete with a lower rate elsewhere, then you need to weigh up the exit fees with the savings to be made paying a lower rate for the remainder of the loan. Do your sums and you’re likely to find it’s worth the hassle of refinancing.
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Myth: Only the big four can offer financial stability
This one is definitely old-school. Once upon a time there wasn’t must choice for Aussies looking for home loans. Although the big four may still dominate the market, today there are dozens of lenders to choose from. They may not have been on the scene for as long, but these newer lenders offer just as much financial stability as their bigger rivals.
Myth: Single people can’t get the same good loan deals as couples
Not true! When it comes to providing loans, lenders don’t discriminate against singles. It all comes down to the numbers. So if a single person can afford to meet their loan repayments, they are just as likely to be approved for a loan as a couple.
Myth: All home loans are the same
This is perhaps the biggest myth of all. The lending market is a competitive space, so that means a lot of banks and financial institutions are battling for your custom. Sure, there are some similar products, but there are some big differences too.
When comparing loans, pay attention to interest rates, fees and charges. Find out how often you can make repayments and whether you can opt for variable or fixed rates.
The ME basic home loan allows you to make repayments weekly, fortnightly or monthly – whatever suits your finances best. It also offers a free redraw facility and you won’t get stung with ongoing account-keeping fees. The ME flexible home loan provides the same features, while also giving customers the choice of variable or fixed rates, or having the best of both worlds with a split loan.
This content was sponsored by ME. Comparison Rate based on a loan of $150,000 for a term of 25 years. This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Terms, conditions, fees and charges apply. Applications are subject to credit approval. For more information, go to mebank.com.au or click the logo below:
