Home Loan Variable: 5.94% (5.95%*) • Home Loan Fixed: 5.79% (6.39%*) • Fixed: 5.79% (6.39%*) • Variable: 5.94% (5.95%*) • Investment IO: 6.14% (6.58%*) • Investment PI: 5.99% (6.61%*)
WHAT IS THE DIFFERENCE BETWEEN A LAND LOAN AND HOME LOAN?
When purchasing land before a build you will generally have to pay a deposit of 10% of the purchase price, with the balance being payable on settlement – this way you pay stamp duty only on the land, rather than on the construction cost of the house.
When building on your existing land you will need two home loans – one for the land and one for the construction. Progress payments on the mortgage will need to be made at different stages of construction.
In cases where you’re buying a house and land package it’s not uncommon to buy the house already completed on the developer’s land. If you decide on this option, all you need to do is give a 5% deposit, with the rest being payable once the home is completed (so no progress payments).
Finding a reputable builder is important. You’ll want to ensure that they provide a ‘Fixed Cost’ build so you’re not left with any nasty surprises. You will also want to ensure they hold all the appropriate insurance and have a good record of maintaining their promised build timeline.
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The comparison rate is calculated on a secured loan of $150,000 with a term of 25 years with monthly principal and interest payments. WARNING: This comparison rate is true only for examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Important Information: Applications are subject to credit approval. Full terms and conditions will be included in our loan offer. Fees and charges are payable. Interest rates are subject to change. Offer does not apply to internal refinances and is not transferable between loans. As this advice has been prepared without considering your objectives, financial situation or needs, you should consider its appropriateness to your circumstances before acting on the advice.
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