Lender products: What do you chose and when.

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Lender products: What do you chose and when.

An Objective View
A weekly blog of Uma Mahadeva
Lender Products:- A quick look.
Lender Products: What do you chose and when
Basic loan, Offset account, Fixed loan, Standard variable loan, Professional Package, Low Fees or no fees. Rate lock, Bridging loan. Owner occupied vs investment.Lenders usually segregate their products to offer the best loans for your situation and needs. They range from the basic no frills with limited features to credit cards, Offset facility, the ability to redraw or not, access to lender branch, internet banking, extra repayments are among the features.
The spreadsheet below gives a visual description of what some of the loan types and features are.

Loan type/Features Redraw Extra payments Offset account Portability* Repayment holiday** Top Up++
Basic variable NO YES NO YES YES YES
Standard Variable. YES YES YES YES YES YES
Fixed Rate Home Loan  YES YES NO YES YES YES
Line of Credit YES YES N/A YES YES YES

*-Ability of the loan to be transferred (ported) to another security.
**- Ability to stop repayments for a specified period of time.
++- The ability to access the equity in an existing property thereby increasing or topping up the loan.

The guide is general only.  There are some lender that allow variations to the guide to make themselves more competitive. E.g Some lenders offer a complete offset to their fixed rate loan, or redraw facilities for their basic variable loan.
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