Unlike fast loans, home loans are long term and really need careful consideration before jumping into one. But with so many available from a number of lenders, how do you choose the right one? Here, we've listed our top 5 tips everyone shopping for the right home loan needs to know:
Shop around- This is going to be one of the biggest decisions as a home owner you are going to make so it is important that you make the right one. Don't be afraid to get a number of opinions from a variety of lenders. It's a very competitive market and so they want to offer you what they can with the knowledge that you will be shopping around for the best deal that will suit you. Even if the first lender you meet with seems to be the right one, for good measure, research a few other lenders before signing with them.
Read the fine print- It is so important that when you are signing up for a home loan, you know exactly what you are signing up for. Some lenders will have all different clauses added to their home loan contracts so going over it with a fine tooth comb can't hurt. If you know someone who is good at going over contracts let them have a look before you sign and have them explain anything you may be having trouble with.
Ask the professionals- There are many companies out there that specialise in giving expert advice about the right loan. The main thing to be wary of here is if the broker has a lenience towards a particular lender and seems to be pointing you in a certain direction without real reason for doing so. For the most part though, there are some very reputable businesses offering great advice which you may want to look into if you are unsure of your own research methods into the best loan for you.
Make sure you get what you want- There are so many lenders offering loans these days that you are able to ultimately (within reason) get a loan that suits all of your needs. These can be as basic as getting a split loan which is where your loan is partly fixed and partly variable. Or you may want to get a loan that has a redraw facility for example.
Know your budget inside out- Cash loans can mean that you are making loan repayments on something leaving you a little out of pocket for a few weeks or months. However, once you sign up to a home loan, miscalculating your budget can lead you into serious financial trouble. Triple check and make sure that you can make the repayments on the loan. Also see what your budget looks like if interest rates go up. Will you still be able to make the repayments then and live comfortably? These are all important things you need to consider before getting a home loan.
Choosing the right home loan is not easy. With the right knowledge and research, you should be able to choose the right home loan to suit your needs. I hope our top 5 tips has given you some useful information on how to go about selecting the right loan for you.