Loan types


Popular questions related to: Loan types

A land loan is a home loan used for the purchase of vacant land possibly intended for the construction of a residential home, but won’t be built on for at least the next 12 months. It could be a way to secure a block of land on which to build your dream home, or a way to diversify your investment portfolio.
A number of lenders offer land loans, but each has their own set of terms and conditions. We can help you understand these special conditions, where they apply, as well as help compare the options that are available to you from our panel of lenders.
A standard home loan has a set time frame and repayment terms. For example, principal and interest repayments or interest only repayments. These usually need to be paid off within 30 years.
A line of credit is an approved limit of equity in your house that can be drawn on at any time. There is no set term to repay the equity and minimum repayments are just the interest and fees accrued. These are typically only approved for customers with a significant portion of equity in their home.
With a principal and interest loan, your repayments cover the amount you borrowed from the bank as well as the interest you are being charged on top. Paying both simultaneously means you will pay off your loan sooner.
An interest only loan requires you to pay the interest charged on your loan only, but for a limited period of time (usually between 1-10 years, depending on whether you’re an owner-occupier or an investor). While this can reduce financial pressure early on, you won’t be making any progress towards repaying the actual cost of your loan. At the end of the interest only period, you will need to pay both principal and interest for the remainder of the loan term.