Mortgage Finance Products

Prolease offers the following Mortgage Finance products:

Standard Variable Rate Home Loan

  • These loans are the most popular home loans in Australia.

  • The interest rate moves up and down generally in line with official interest rate fluctuations.

  • You have a choice of flexible repayment options.

  • You can pay weekly, fortnightly or monthly, enabling you to organise repayments to suit your needs.

  • Maximum period of the loan is normally 30 years

 

Discount Variable or Honeymoon or Introductory Home Loans

These are variable rate loans with a discounted interest rate off the standard variable rate (commonly over 1%), lasting a certain period of time, usually one year.

  • After this period, they normally revert back to the standard variable rates.

  • Depending on the lender, interest rates can be fixed or capped during the initial/honeymoon period.

  • These rates are among the lowest rates available and are often used by first home buyers. The exit fees are generally higher if the loan  is paid out in the 1st 4 years of the mortgage contract.

 

Basic Variable Home Loans

These are variable loans with lower interest rates, but with fewer features than a standard variable loan. They are typically called "no frills" loans.

  • More features are being added by some lenders as the market becomes more competitive such as the ability to separate the loan into a fixed and variable rate loan.

  • They are typically around 0.5% - 0.7% less than the standard variable rate.

  • They are generally not available with an offset account.

 

Line of Credit Home Loan

This is a credit facility secured against your property.

  • This facility is available for any personal purpose - you can refinance existing loans, undertake home improvements, renovations, even buy another property or finance personal investments.

  • It operates as your everyday transaction account, giving you immediate access to funds up to your agreed credit limit.

  • By having your salary and other income paid directly into the account, your funds will work daily to reduce both the principal and interest owed on your loan. This can potentially save you thousands of dollars in interest.

  • Caution – This type of loan does not suit everyone as you only have to pay the interest expense (plus any fees) each month. There is a real risk of never paying down the mortgage.

 

Fixed rate loan

A fixed rate loan means that the interest rate is fixed for a particular period.

  • It could be easier to budget with a fixed rate loan.

  • You are restricted to the amount of lump sum repayments of the loan. The offset account is not 100% offset.

  • There could be a break cost if you refinance or sell the property prior to the expiry of the fixed rate period.

  • The fixed rate loan usually reverts to a standard variable loan after the fixed rate term has expired.

  • An option could be to split your loan with a portion fixed and a portion variable.

 

Commercial Loans

Commercial loans are secured against commercial properties and can be either owner occupied or an investment.

  • Variable and Fixed rates are available.

  • Interest rates are generally at a higher margin than residential loans.

  • Loan terms are a maximum of 15 years or interest only for 5 years.

  • Bank establishment fees are usually a percentage of the loan amount.

  • Maximum Lender LVR’s are around 65%. i.e 35% deposit required

 

Professional Packages

Lender's professional packages offer a range of discounts off the Variable and Fixed rate loans if you are borrowing $150,000 or greater.

  • There are discounts ranging from 0.4% to 0.7% and higher for loan amounts greater than $750K.

  • Lenders usually charge an annual fee for the package.

  • Annual fees include all the application, valuation and ongoing fees for the loan.

Additional benefits may include waiving of transaction fees, credit card fees and discounts on other banking products.

 

Low Doc Loans

A Low Doc or No Doc loan is ideally suited for investors or self-employed borrowers.

  • No tax returns or financial statements required.

  • The Income declared will be used for the loan assessment.

  • Most types of loan products are available on a Low Doc basis.

  • Interest rates and fees can be slightly higher.

 

Offset Accounts

A standard variable Rate home loan can be linked to a savings account called an offset account. Interest is only charged on your home loan balance less the offset account balance.

  • Additional loan payments can be made to your Offset account as opposed to your home loan.

  • Offset accounts can be a transaction savings account.

  • You can access your funds anytime.

  • Salary credited direct to your offset account reduces your interest payable.

 

Redraw Facility

This allows you to make additional repayments on your home loan with the ability to redraw these funds for your future requirements.

  • Available on variable loan products.

  • Redraw funds can be used for any purpose - renovating, purchasing another asset or even a holiday.

 

Split Loan Facility

Your mortgage can be split depending on your requirements.

  • A portion fixed and a portion variable.

  • With interest rates increases, this would only affect the variable portion of your loan.

  • A split loan is useful if using your mortgage for different purposes.

  • You could, for example, have 4 splits based on the following:

    Home loan, share investment, renovation and holiday.

 

Interest Only Loan

The mortgage can be structured whereby the payments are interest only.

  • No principal is paid off the mortgage.

  • Interest only terms are normally between 1-5 years.

  • At the end of the interest only term the loan reverts to Principal & Interest for the remaining term.

Interest only loans are popular with investors where the interest is tax deductible.

 

Switching your loan

Switching allows you to switch from one loan type to another.

This is usually done to switch from a variable rate loan to a fixed rate loan.

 

Portable Loan

A portable home loan allows you to take an existing loan to another property without having to refinance.

This is assuming that you are exchanging properties on the same day or within a few weeks of each other.

 

Repayment Holiday

Many lenders now offer either full or partial repayment "holidays" for periods of time.

  • Normally applies to people that have lost their job or taking time off work in a career change or in unforeseen circumstances.

  • Interest will be charged to your loan but no payments required during the holiday period. This assumes that you are not at your loan limit.

 

Top Up Facility

This feature allows you to increase the limit on your home loan.

 

Construction Loans

For renovating or rebuilding your home.

  • The loan is usually a standard variable loan but does not have all the features of a standard loan during the construction period.

  • During construction the interest is typically paid monthly on an interest-only basis.

  • When the house is complete, all features of the loan become available.

 

< back to Services