What Kinds Of Home Loans Are Out There?

Home Loans: There are many different kinds, you must just figure out which is the best for you.

First and foremost, there is the most normal one of all, and that's the variable rate home loan. This kind of home loan is available at all banks and institutions over any period of up to 30 years. The only downside is if interest rates go up, yours will also go up, but should it come down, you'll also benefit because then your rate also comes down.

Secondly you have fixed rate home loans. These type of loans are exactly what their name implies, the rate doesn't change while the rate is fixed. So, you'll always know what you'll pay at the end of the month. The upside is that should the interest rate go up, your rate won't change, but the downside is that if the interest rate comes down, your rate won't change. This type of loan is also available at all major banks and institutions.

Third you have interest only home loans. This is where you pay only the interest on the loan on a monthly basis and then at the end of the 20 year loan term you re-finance the capital. This is a good option if you are only planning on staying in the home for a short period or if your are bying low to sell high.

Lastly you have the low risk capped home loan. This loan is not freely available, but it is definitly a nice one to have if you want to control your payments in an uncertain income market. This is where your home loan installment is capped at a certain percentage above prime, perhaps 1 or 2% for a fixed period of 2 years. Your home loan interest rate will move up and down below this "ceiling" rate as the prime interest rate fluctuates, but will never move above the "ceiling" rate.

These are the home loans options you have available when applying for a home loan. If you need more information please do not hesitate to contact us through our website : http://www.gpfmortgage.co.za/sa-home-loans.html