When diving into the world of home loans, many first-time buyers overlook features and get laser-focused on one thing: interest rates. And while landing a low rate sounds like the ultimate win, there’s so much more to consider.
Choosing the right home loan is about more than just a number—it’s about finding features that fit your financial goals, lifestyle, and even how you like to manage your money.
Whether you’re stepping into the property market for the first time or thinking about refinancing, knowing the ins and outs of loan features can save you time, stress, and a surprising amount of money over the long haul.
Why loan features matter
When you compare home loans, the features they offer aren’t just bells and whistles—they can make a real difference to your financial flexibility and overall savings.
The right combination of features could help you shave years off your loan, reduce the amount of interest you pay, and keep your cash flow manageable.
Over the years, we’ve seen first-hand how choosing the right loan features can transform someone’s financial journey. Below are five must-know features that could make your home loan work harder for you.
Whether you’re buying your first home or reassessing your current loan, these features are worth exploring.
1. Offset accounts
Think of an offset account as your secret weapon against interest. It’s essentially a transaction account linked to your home loan.
Any money you keep in this account offsets the loan balance, meaning you’ll only pay interest on the difference.
For instance, if you owe $800,000 and have $20,000 in your offset account, you’ll only pay interest on $780,000. Over the life of your loan, this can save you tens of thousands of dollars.
- Best for: Savers or anyone with a regular income stream who can maintain a healthy account balance.
- The perk: Massive interest savings while still keeping your money accessible.
2. Redraw facility
Ever wish your extra loan repayments could double as an emergency fund? That’s exactly what a redraw facility offers.
It lets you access any additional repayments you’ve made, giving you flexibility while keeping your loan balance (and interest) in check.
It’s like having a safety net that encourages saving without locking your money away.
- Best for: Borrowers who like to save but want peace of mind knowing their funds are accessible in a pinch.
- The perk: Flexibility to dip into your extra repayments when life throws a curveball.
3. Flexible repayment options
Would you rather pay off your loan in smaller, more frequent chunks? Many lenders allow you to choose between weekly, fortnightly, or monthly repayment schedules.
Opting for fortnightly repayments is a smart move—it means you’ll make 26 payments a year (equivalent to 13 months of repayments), which can help you pay off your loan faster and save big on interest.
- Best for: Anyone keen to speed up their loan payoff without breaking the bank.
- The perk: Makes reducing your loan term a manageable and automatic process.
4. Split loan option
Can’t decide between the security of a fixed rate and the flexibility of a variable rate? A split loan gives you the best of both worlds.
You can divide your mortgage into fixed and variable portions, providing stability on one hand and potential savings if rates drop on the other.
- Best for: Borrowers wanting to hedge their bets in an unpredictable interest rate environment.
- The perk: Stability and flexibility rolled into one.
5. Extra repayment facility
If you’ve got surplus income or find yourself with a little extra cash (hello, tax refund!), an extra repayment facility lets you put that money toward your loan without penalty.
This not only accelerates your payoff but also reduces the total interest you’ll pay over the life of the loan.
- Best for: High-income earners or anyone who wants to knock out their mortgage faster.
- The perk: Frees you from years of repayments and saves a fortune in interest.
Choosing the right loan for you
The “best” home loan features depend entirely on your personal circumstances and financial goals. Are you someone who values flexibility? Or do you prefer the peace of mind that comes with predictable repayments?
Understanding how these features work—and which ones align with your needs—can make a huge difference in how you manage your loan and achieve your property dreams.
Don’t go it alone
Feeling overwhelmed? You’re not alone. Home loan options can feel like a maze, especially when you’re trying to figure out which features are actually worth it.
That’s where a mortgage broker comes in. We’ll help you cut through the confusion, tailor your loan to your lifestyle, and ensure you’re getting the best deal possible.
* This blog is intended for general informational purposes only. For personalised advice tailored to your unique financial situation, please contact NMC Finance.
