The perfect home loan could save you thousands of dollars, be used to create significant personal wealth, or have you owning your home sooner.

The first step in finding the perfect loan is, however, preparation.

The first thing is to do your homework and decide what sort of loan is suitable for you because you’re likely to have this loan for 25 or 30 years.

Some things to consider include whether you want a fixed or variable interest rate or a mixture of both, ensuring you are aware of all fees and charges associated with the loan, and whether you could make additional repayments.

Another thing that is recommended is to make sure that you look at the comparison rate, not just the loan rate: the comparison rate is a requirement by government and that includes all the costs, loan approval fees and any ongoing fees.

If for any reason a financial institution does not make the comparison rate known to borrowers, you have every right to ask to be shown it.

Borrowers should also review their home loan annually to ensure it still met their needs, because families and circumstances constantly change.

National Australia Bank state general manager retail banking Ann-Marie Chamberlain said choosing the right home loan was as important as choosing a home.

“The best place to start is by considering your financial goals and then choosing the home loan to match,” she said. “For example, a homeowner might decide to pay their home off in 15 years rather than 25 years, so their home loan should allow for additional repayments.

“Other features to consider include interest offset accounts, which can help people to pay off their loan sooner, and the opportunity to attach a line-of-credit to the home loan to assist with wealth creation.

“It’s also worth investigating what redraw facilities are available. It’s important to think about what it is that you want from your home loan, and then choose a product with the facilities to match.”

It’s also advisable for borrowers not to put too many other purchases on to their home loan as while personal loan rates might be a little higher, a car or holiday would be paid off quickly rather than sitting on your home loan attracting interest for 10 years or more.

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