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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, 16th Jan 2021

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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rebekah herington

Peter Hammond is an absolute gem. I was super anxious about signing up for a mortgage and buying a place, Peter could not have been more supportive. He ensured that my priorities and preferences were taken into account, presented me with several options and guided me to choose the best loan option for me while also ensuring I took advantage of any schemes I was entitled to. He was always prompt in responding to enquiries, never made me feel pressured to rush into anything I wasn't sure about (I took more than 6 mnths to find a property) and provided me with endless relevant information throughout. Overall, I'd say Peter went above and beyond and I have no qualms in referring anyone to him.
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Christopher Busuttil

Great Experience with Get a Better Rate . If we could give more than 5 star to our broker Peter Hammond we would cause he deserves it. He's been so helpful and patient to us from the start up to this point of our loan. He's very professional and passionate with his job. Very reliable and easy to communicate as you can contact him at anytime and response as soon as he can.. Most of all for a first timer like us it would have been so hard for us to understand how things works but he manage to explain everything in a professional and yet understandable and the easiest way. Without his guidance we wouldn't make this experience as easy and enjoyable as it is.. Glad we have him in this journey of our loan.. Thank you Peter..
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Ammar Khan

Highly recommend Peter from 'Get a Better Rate'. We received friendly, helpful and professional service from 'Get a Better Rate'. We were given a range of options to choose from for our home loan refinance. We were kept up-to-date with status updates throughout the whole process. Overall, very happy with the service that we received.
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Matthew Booth

We refinanced through 'Get a better rate' and were very happy with the whole experience. Peter discussed our needs, presented options and then helped us decide what was best for our situation. He moved through the process at our pace (quickly) which was lucky because we settled just 2 days before the bank raised their rate. I can confidently recommend Peter and Get a Better Rate

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