Newsletter, April 2017 – Interest only loans


There’s been a lot of talk in the media lately about affordability of home loans, particularly interest only loans.

Whilst there are benefits of paying interest and principle, there also are benefits of interest only loans – particularly for investors due to the tax benefits offered.

Interest only loans do have special conditions, they often have a higher interest rate, more restrictions and a fixed term (such as 5 years) before reverting back to principal and interest repayments .

What we need to ensure is that interest only borrowers can afford the repayments of principle AND interest once the interest only period expires. That’s why we do affordability analyses on every loan application because we need to ensure it’s the right loan for now and the future.

It’s important to do your homework and be aware of the terms and conditions of any loan that you’re signing up for.

And with the changing lending environment, it’s a great time to get a broker to wade through the options and explain everything in plain English.

Whether it’s for investment or living, whatever you need to finance, I’d love to help!

Michael Luca
0405 113 543
michael@lovehomeloans.com.au