Choosing the Right Home Loan

With so many home loan products available, it’s often difficult to choose the best one. While mortgage brokers can help, there are several steps you can take yourself to ensure you get a good product.

As the lending industry has evolved, borrowers have had to deal with more complexity. Lenders now offer all sorts of home loans, many of which come with additional features bolted on. You also need to choose between different loan types. Options range from variable and fixed-rate loans to introductory and interest-only loans.

Borrowers need to understand what all of these terms mean so they can find the loans that best suit them.

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Get Started ### The Things You Should Consider

Many new borrowers make the mistake of only looking at the interest rate when applying for a home loan. While this rate is obviously important, there’s much more to consider when searching for a loan.

For example, loans with low interest rates might have high fees attached. Conversely, you may pay more interest for a loan with a lot of added features. This makes finding the right loan a balancing act. You need to set priorities and align your goals with the loan features.

Your loan must meet your personal needs, so figure out the structure before you start looking at lenders and rates.

Furthermore, your deposit will help to determine the type of home loan lenders offer you. You may pay Lender’s Mortgage Insurance (LMI) if your deposit is less than 20% of the home’s value. Some lenders waive LMI, but you may have to pay steeper fees or a higher interest rate in return.

Use your deposit as your starting point, then sift through the available loans to find a structure that suits you.

The Key Features

We mentioned loan features before, so let’s expand on that here. You must remember that not all home loan features will meet your needs. For example, there’s no point in having an offset account if you don’t have enough money saved to take full advantage of it.

Having said that, there are some loan features that most people can take advantage of. They include:The option to make early repayments

The option to make repayments through multiple channels. For example, many loans allow you to repay via the internet, telephone or using an ATM

Loan portability, allowing you to move your loan if you move house

The option to re-fix your interest rate so you can take advantage of the national interest rate.

Ultimately, the key features of the loan will depend on your circumstances. Speak to a home loan consultant to find out about the features that could benefit you.

Choosing a Lender

An attractive loan package may mean very little if you have an unresponsive lender. The service you receive must match the loan features.

Research any lender you consider before applying for a loan. Listen to people who’ve worked with the lender before and check the lender’s website to find out more.

You need to find a lender that communicates well after settlement and during the application period. For example, it’s worth finding out if the lender has customer service personnel in branches, or if you have to contact a call centre when you need help.

Loan Transparency

The best way to deal with the complexities of a home loan is to make it as transparent as possible. Learn about the loan and everything attached to it, rather than just looking at the interest rate.

The good news is that lenders must answer any questions you have about the loan. In addition to the fees that you know you have to pay, ask about any that you’ll probably have to pay. For example, many people refinance their loans at some point, which can involve multiple fees. Ask about all these fees, rather than focusing on one. Some lenders limit their explanations if you only ask about one term.

A few lenders waive their application fees to tempt customers. While this may seem attractive at first, ask about any hidden fees that might cover the cost that waiving the application fee places on the lender.

Despite this, you can find loans with good rates and low fees that also offer the flexibility you need later on. You just need to ask the right questions or work with a home loan consultant who can ask them for you.

How much can I save by refinancing?

Use UNO's calculator to estimate your savings.

Calculate Savings ### Using Comparison Rates

The government introduced comparison rates to offer consumers a more accurate idea of the cost of their home loans. The comparison rate pulls the loan interest rate and fees together, creating a percentage figure that’s often higher than the interest rate alone.

This makes them useful for understanding how much a loan will cost. For example, you may find that a loan with a high rate actually costs less than one with a low rate, once you take the other fees into account.

Unfortunately, comparison rates are not perfect. The calculation used for comparison rates is a set figure and loan term, which is unlikely to match your particular scenario.

This means the comparison rate alone isn’t enough to tell you what you’re getting. You need to understand every aspect of the loan’s structure.

Can a Mortgage Broker Help?

Mortgage brokers can help you to sift through the information if you’re unsure about what you’re looking at. Brokers also have access to many loan products and can offer specific advice for your personal situation.

However, you must choose the right broker. Be wary of any brokers who work with a small number of loan companies, as this means they don’t offer the variety you need to find the best home loan.

Also, check that the broker has registered with the Australian Securities and Investments Commission.

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What our customers are saying

Sally Mackenzie
February 19, 2024
We chose Uno Home Loans from their impressive web site knowing we were going to find it hard, on many fronts, to qualify for a home loan. We were incredibly fortunate to be assigned Mike Parsons as right from the get-go, despite the complexities, he hit the ground running for us. He was incredibly knowledgeable, with years of experience but what was immediately apparent and impressive was that he was totally invested in getting us over the line, doing absolutely everything possible, including working around the clock. Despite it being a relatively small loan in the order of things, Mike never missed a beat, getting docs ready, following up and answering every request from the proposed funder immediately. He kept us informed on progress the minute anything happened, and again if anything needed to be done, he was right on it. In short, we highly recommend Uno, and Mike, knowing what a remarkable job he did, over many weeks, to get us our loan. He got us a great deal, with far better rates than we expected, so we couldn't be happier. In fact, without doubt, you'd be hard pressed to find a more personable, sharp, hard working, dedicated professional who clearly prides himself on getting his customers standout results.
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February 13, 2024
Scott and his team were just A-mazing. We felt supported through the whole process with the greatest quality and care. Every question answered right in time, or even before we asked. The process was smooth and we got the best outcomes we could have wished for.
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Angela Biddle
February 6, 2024
Our mortgage recently came up for renewal, and with interest rates skyrocketing we were looking for ways to minimise the impact. Michael and his team were proactive and attentive. Michael spent time with us to understand our circumstances. He found mortgage options that worked with our current financial situation and longer investment plans. He presented clear options, providing guidance where needed. He and his team were helpful and responsive - streamlining the process and keeping us updated through the negotiations. In the end, Uno did the heavy lifting and secured a significantly better rate than our current bank offered, all with friendly, personal service. We would highly recommend UNO Home Loans.
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Fotis Bikas
January 15, 2024
I cannot help but congratulate Scott Wilkinson of UNO Home Loans for being an absolute credit to both his company and the entire loans industry. Scott is a truly rare gem of a broker in that he will not only go the extra mile to achieve for each customer the very best deal, but his knowledge of all and sundry within the industry is unsurpassed (you will see what I mean if you speak to him). Additionally, Scott has a clear passion for imparting his wealth of information with each customer, whereas the conversation with most other brokers would simply be over if they could not get you the best deal. For me, Scott Wilkinson of UNO Home Loans stands head and shoulders above the competition and I feel privileged to benefit both from his expertise and professionalism whenever it is time for a refinance or new loan.
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Tomoharu Matsui
January 11, 2024
Michael Parsons helped me a lot when it's difficult to establish my capabilities in loan.
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Gillian Kearon
January 9, 2024
I highly recommend Mike Parsons as a mortgage broker. I couldn't fault the service provided by UNO. Thanks Mike!
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Taner T
December 20, 2023
Thank you Eren Tan for the amazing service and support. Our Loan was a little tricky and complex for other lenders but Eren managed to get it over the line in record time. His professionalism and dedication to our needs was exceptional. If you need a Loan no matter how complex your situation, make sure you contact Eren at UNO Home Loans.
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Karaipu Brown
December 20, 2023
Buying & selling a house at the same time is very stressful but Scott Wilkinson from UNO home loans made sure we knew what was happening & took most of the stress away. He always kept us up to date and if we had a concern or wanted clarification on something we were able to call him, if he didn’t know the answer straight away he will find out and contact us back.. now we are enjoying our new house and turning it into a home :)
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Chris Anderson
December 18, 2023
Just completed my first loan with UNO which was so much easier than with other other brokers I have used in the past. Our broker MIKE PARSONS always had time for me and broke things down for me in the simplest of terms and was very patient with my silly questions and my constant changing of plans. I wish I had used them in the past as I wouldn't be in the situation I'm in now. Can't recommend them highly enough. Thanks UNO and Thanks MIKE 😊
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Stephen Broomfield
December 11, 2023
To be able to recommend Scott Wilkinson for your mortgage broker was a privilege. We had deals fall through but Scott supported, guided and stuck with us, proper partnership. The whole team at UNO helped us and supported us right through to after settlement. Made sure everything was correct and how we are progressing. Communication was amazing and straightforward and easy to understand. Transparent. We can not Recommend Scott and the team as Uno high enough. Use UNO with confidence.
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Tarek Hussain
December 6, 2023
Can't thank Amy enough for her hard work, dedication and determination on getting multiple loans completed for me. I wouldn't hesitate in recommending Amy and the Uno team to any of my associates. Will definitely be back in the near future!
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November 3, 2023
If you’re looking for a trustworthy, thorough, reliable & knowledgeable Mortgage Broker then you must call Anita Callaghan! I can’t even imagine how stressful this process would’ve been without her. Anita went above and beyond to make sure she answered every question, responded to every text (even on weekends/after hours), and followed up on every detail to ensure we had all the info we needed. Anita is a true people person who is warm, empathetic, kind and supportive. You can tell she loves helping people and loves what she does, which is probably why she’s so good at it! Can’t thank you enough Anita, or recommend you more highly! You’re the best!
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