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Interest Only Home Loans

Does an interest only loan meet your goals and objectives?



Today's Lowest Interest Only Investment Loan Interest Rates

Last updated 6:00am, 17th Jan 2022

Interest Only Home Loans

An interest only loan, allows you to only pay the outstanding interest on your home loan. The balance or principal amount of your loan will not decrease until the interest only term has ended.

Interest only home loans are popular with investors seeking to maximise any potential negative gearing benefits or maximise repayments on non-deductable debt. These are two strategy which you can discuss with your accountant or financial planner, to understand if they could be right for you.

Lenders offer interest only loans for a fixed period, usually 1 to 5 years. At the end of the interest only term, the loan will automatically revert to principal and interest (‘P&I’) repayments, over the remaining loan term. As a result, the P&I repayments over remaining term will be higher than they might have been at the commencement of the loan.

If you would like to know more about interest only loans or would like to review your existing interest only home loans, please with one of our qualified mortgage brokers today.

Interest Only Loans FAQ

Can I extend my interest only period?

Can you request an extension to your interest only period, although most lenders will limit you to a maximise of 5 years. You can refinance your loan to a new lender, requesting a new interest only term.

Can I make principal repayments?

Yes, most lenders will allow you to make principal repayments above your minimum interest only payment. Speak with your lender or your mortgage broker to check the process and policies of your home loan.

Is an interest only loan more expensive?

Typically, an interest only loan has a higher interest rate than a principal and interest loan. Interest rates will vary between lenders and you should ensure you compare loans from a range of different lenders to find a suitable product.

If you would like assistance, our qualified mortgage brokers would be glad to help.

Should I make interest only repayments, on my investment loan?

Whether interest only loan repayments the right option, depends on an individual’s strategy and circumstance. It is always recommended to seek advice from your accountant or financial planner about your financial goals.

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Customer Reviews

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jack smith

I can’t speak highly enough about Peter at Get a Better Rate. He is very knowledgeable and reliable, would seriously recommend!!
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Connor O'Meara

Peter came highly recommended by a friend. We found him to be extremely professional, excellent and prompt with communication and patient with our many first home buyer stupid questions. A lot of hand holding, but he was always happy to help. Thanks for your help.
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Lisa Tran

It was a pleasure meeting Peter and have him guide us through what needed to be done for our home loan. He was responsive and knowledgeable, provided the best advice for us and was able to answer any queries thrown at him.
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Adwar Alkhamesi

Peter has been an outstanding broker from the outset of the matter all the way to settlement. He explains everything very clearly and provides an excellent service by offering the best loan to suit your personal circumstances. He is always very attentive, knowledgeable about the entire process and provides regular updates to alleviate any stress. Even when I hassle him with emails and phone calls, he somehow always manages to respond within 24 hours. Highly recommend his services to anyone looking to get a loan and will definitely be using him again in the future!

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