Penalty-free additional repayments and unchanged interest rates during the set period mean you're rest assured during the fixed period of your loan.
Heritage Bank's fixed-rate home loans can give you peace of mind with fixed interest rates and the option to settle with lump-sum or additional repayments without the risk of a penalty.
Coupled with an extended period of rate stability and a recent increase in home-loan approvals in Australia, this could make it a favourable climate in which to consider a property investment.
Heritage Bank also offers discount, basic and standard-variable options for home loans. Borrowers can even switch from one to another (except to the discount variable option).
|Product Name||Heritage Bank Fixed Rate Home Loan|
|Interest Rate Type||Fixed|
|Comp Rate^ (p.a.)|
|Minimum Loan Amount||$20,000|
|Minimum Loan Term||1 year|
|Maximum Loan Term||30 years|
|Maximum Insured LVR||95%|
|Mortgage Offset Account||Yes|
|Mortgage 100% Offset||No|
|Loan Redraw Facility||Yes|
|Split Loan Facility||Yes|
|Fixed Interest Option||Yes|
|Suitable for Investment||Yes|
|Available as equity loan/line of credit||No|
|Repayment Type||Principal & Interest and Interest Only Options|
|Lender's Legal Fee||$0|
|Ongoing Fees||$8 monthly ($96 p.a.)|
- No legal fee, valuation fee and discharge fee.
- You can make extra payments at any time and withdraw the funds using the free redraw facility.
- There is $8 per month account fee.
- $600 application fee.
Things to consider about Heritage Bank’s fixed-rate home loan
Heritage Bank offers borrowers an unchanged interest rate for a term of between one to five-year loan periods. If the loan is repaid before the end of the fixed term, borrowers are liable to pay a break fee (non-applicable in the case of the basic, discount and standard-variable home loan options).
This fixed-rate loan could be ideal for tentative first-time home buyers because it eliminates the risks that come with fluctuating interest rates. The bank's standard variable rate applies once the fixed-term period expires.
Features of the Heritage Bank fixed-rate home loan
- Loan amount. Heritage Bank home loans start at a minimum of and go up to a maximum of with a loan term of up to years.
- Maximum loan-to-value ratio (LVR). Maximum LVR is set at for this loan, enabling borrowers to invest in a purchase even with a small deposit (less than 20% of the purchase price). The same LVR applies to the discount, basic and standard-variable options. You should note that you will have to pay Lender’s Mortgage Insurance (LMI) if you borrow with an LVR above .
- Partial offset account. Fixed-rate home-loan borrowers can benefit from a partial offset account. This all the features of a regular transaction account while assisting in repaying the loan quicker and with less interest. This service is provided without a monthly fee and comes with a number of add-ons like free internet and mobile banking.
- Repayment and redraw facilities. Borrowers can choose between weekly, fortnightly and monthly payments. Additional and lump-sum payments can be made without risking penalties. A redraw facility allows access to additional repayments accumulated over time.
- Refix at no cost. Once the fixed term of a loan ends, borrowers can start another fixed-rate cycle at no extra cost.
- Construction loans. Heritage Bank grants construction loans with this fixed-rate option.
Fees you can avoid
- Break fee: This fee is levied if the loan is paid back before the end of the fixed period.
- Lender's mortgage insurance (LMI): LMI will not be charged when the borrower's deposit covers 20% or more of the purchase price.
- Redraw fees: If borrowers choose to use the redraw facility during the fixed term, a fee of $20 applies (varies from state to state).
Fees you can’t avoid
- Application/establishment fee: $600. This fee is charged to cover the cost of arranging the loan. This includes creating files, putting together interviews and processing documents. In cases where additional products are offered as part of a package deal, this fee may be discounted by as much as $200.
- On-going fee: $8 per month. All home-loan options are subject to this fee.
- Rate guarantee fee: This is non-refundable and amounts to 0.12% p.a. of the total borrowed. This fee fixes the interest rate for the duration of the loan's fixed term.
- Valuation fee: Heritage Bank will charge valuation fees up to $330 where only one valuation is required. Any further valuations requested during the loan's fixed term will be charged in full to the borrower.
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How to apply for the Heritage Bank fixed-rate home loan
If you would like to apply for a home loan from Heritage Bank, please speak to a mortgage broker or speak to Heritage Bank directly.
To meet the criteria, home-loan applicants who aren't already Heritage Bank customers have to be permanent residents in Australia. A Heritage Bank home-loans specialist will provide assistance.
Whether applying online, in person at the nearest office or by post, getting all the necessary documentation in order is the first step to ensuring a smooth application process. Essential documents include:
- Savings history for the last three months
- Personal identification (driver's licence, national ID card, passport)
- Proof of income and financial statements
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Heritage Bank Fixed Rate Home Loan Interest Rate History vs RBA Cash Rate Graph
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