Top Tips to Choose Your Property Ownership Home Loan

Understanding Property Ownership Options in Ipswich

When you're looking to achieve home ownership in Ipswich, understanding the different home loan options available makes a real difference to your financial stability and future. Whether you're purchasing your first home or adding to your property portfolio, choosing the right owner occupied home loan involves knowing what home loan products suit your circumstances.

Property ownership through an owner occupied home loan means you'll be living in the property as your primary residence. This differs from investment loans, where the property generates rental income. Owner occupied home loans typically offer lower home loan interest rates compared to investment properties, which can help you save thousands over the life of your loan.

Key Home Loan Features to Consider

When you apply for a home loan, you'll encounter various home loan features that can significantly impact your repayments and flexibility. Let's explore the main options:

Interest Rate Types:

• Variable rate: Your interest rate fluctuates with market conditions, meaning your repayments can go up or down. Variable home loan rates often come with additional home loan features like offset accounts and the ability to make extra repayments
• Fixed interest rate: Lock in your interest rate for a set period (typically 1-5 years), giving you certainty about your repayments regardless of market changes
• Split rate: Combine both fixed and variable portions in your loan amount, balancing security with flexibility

Repayment Structures:

• Principal and interest: Each repayment reduces both the interest charged and the loan amount, helping you build equity in your property
• Interest only: Pay only the interest for a specified period, though this won't help you build equity during that time

How Offset Accounts Work

A mortgage offset or linked offset account is one of the most valuable home loan benefits available. This savings account links to your home loan, and the balance in your offset account reduces the amount of interest you pay.

For example, if you have a $400,000 loan amount and $20,000 in your offset account, you'll only pay interest on $380,000. This can save you thousands in interest charges and help you pay off your loan faster while maintaining access to your savings.

Comparing Home Loan Rates and Packages

Conducting a home loan rates comparison helps you understand what's available across different lenders. At Get Approved, we can access home loan options from banks and lenders across Australia, giving Ipswich residents a comprehensive view of current home loan rates and home loan packages.

When you compare rates, consider:

1. The advertised interest rate and any interest rate discounts or rate discount offers
2. Home loan features included in various home loan products
3. Fees and charges associated with the home loan application and ongoing maintenance
4. Whether the loan offers portability (a portable loan lets you transfer your loan to a new property)
5. The loan to value ratio (LVR) requirements

Understanding LVR and Lenders Mortgage Insurance

Your loan to value ratio (LVR) is the loan amount expressed as a percentage of the property value. If you're borrowing more than 80% of the property value, you'll typically need to pay Lenders Mortgage Insurance (LMI). This protects the lender if you can't meet your repayments.

For Ipswich property buyers, saving a larger deposit to keep your LVR below 80% can save you from paying LMI, which can cost thousands of dollars. However, some borrowers choose to pay LMI to enter the property market sooner rather than waiting to save a larger deposit.

Home Loan Pre-Approval Benefits

Getting home loan pre-approval before you start property hunting in Ipswich gives you several advantages:

• Know exactly what loan amount you can borrow
• Show sellers you're a serious buyer with confirmed finance capability
• Understand your borrowing capacity to search for properties within your range
• Lock in current home loan rates for a specified period (typically 3-6 months)
• Speed up the purchase process when you find the right property

Building Equity and Improving Borrowing Capacity

As you make your principal and interest repayments, you build equity in your property. This equity represents the portion of the property you actually own. Building equity helps you:

• Improve borrowing capacity for future property purchases or refinancing
• Potentially access lower rates due to a reduced LVR over time
• Create a financial buffer for your secure future
• Provide options to invest in property down the track

Calculating Home Loan Repayments

Understanding calculating home loan repayments helps you budget effectively. Your repayments depend on:

• The loan amount you borrow
• The interest rate (variable interest rate or fixed interest rate)
• The loan term (typically 25-30 years)
• Whether you choose principal and interest or interest only repayments

If you need lower repayments initially, you might consider interest only for a period, though this won't help you build equity. Alternatively, extending your loan term reduces monthly repayments but increases the total interest paid over time.

Working with Get Approved in Ipswich

As your local mortgage broker in Ipswich, Get Approved understands the property market and lending landscape specific to the area. We help you:

• Access a wide range of home loan options and home loan products
• Navigate the home loan application process
• Find suitable home loan features for your situation
• Understand first home buyer schemes and grants available in Queensland
• Review your borrowing capacity to maximise your purchasing power
• Explore refinancing options if you already own property

Whether you're looking for the lowest rates, specific home loan features like an offset account, or need help understanding a split loan structure, our team provides personalised guidance tailored to your circumstances.

Achieving home ownership in Ipswich starts with understanding your options and choosing the right home loan products for your situation. The right owner occupied home loan, combined with suitable home loan features, sets you up for long-term financial stability and helps you secure your future in the property you'll call home.

Call one of our team or book an appointment at a time that works for you to discuss your property ownership goals and find the home loan solution that fits your needs.