Some of the top-rated home loans for investors and refinancers in June 2023

As we approach the middle of the year, many Australians may be facing the fixed rate mortgage cliff. Australians looking to refinance the mortgage on their family home or investment properly may need to compare different options to find a mortgage option that should suit their needs.

It’s important look at more than just the interest rate when comparing different mortgages. For example, broker data shows a big difference in approval times between different lenders.  There are also cashback offers available from some lenders, though more of these deals are being withdrawn from the market.

To help make your mortgage search that little bit simpler, RateCity’s Real Time Ratings™ combine the cost of a home loan with its flexibility, expressing it as a simple star rating that’s regularly updated to help ensure accuracy. You can quickly compare the top-rated loans in different categories on RateCity’s Home Loan Leaderboards, and consistently top-rated loans may become eligible for the RateCity Gold Awards.

(Rankings are correct at the time of publishing. Please note lenders may trade places on the list as interest rates and fees change and RateCity’s tracker reflects these movements.)

Some of the top-rated refinance home loans

After 12 rate rises in 14 months, borrowing power has reportedly fallen by almost $250k. This could make it more challenging for some mortgage holders to refinance, especially if they’re hoping to get cash out of their home by borrowing more.

Australian homeowners looking to refinance may want to check their home value to estimate their equity before they start applying for a new mortgage. Generally, the more equity your hold in your property, the lower the interest rate you may be eligible for when you refinance, which may be able to help extend your borrowing power.

Some of the top-rated investor variable home loan

Despite rising interest rates, and reduced borrowing capacity, recently released APRA figures show that investors and owner occupiers are mostly avoiding risky levels of debt. APRA’s Quarterly ADI Property Exposure report for the March 2023 quarter shows just 7.5 per cent of new owner-occupier and investor loans had a debt-to-income ratio of six times or more, in dollar terms – the lowest level since March 2019.

With this in mind, it’s important to carefully look at your own income, expense and more before applying for an investor loan, as these factors can all affect how much you can afford to borrow.  

Some of the top-rated 2 year interest only investor home loans

Despite a brief pause in April 2023, stubborn inflation plus new employment data and other factors mean that economists from some big banks are forecasting additional rate rises before the end of the year. And while some of these economists are also predicting that the RBA could start cutting the cash rate sometime in the 2024 or 2025, this will all depend on how inflation responds to the rate hikes in the future.

Investors hoping to avoid changing rates could instead choose to lock in an affordable fixed rate now, and also pay interest only. While this won’t help you to pay off the property, it could help to keep your repayments stable and your cash flow under control for a limited time. Though you’ll still need to consider the revert rate when the fixed rate period expires, and you may end up paying more total interest on the property over the long term.

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