Glossary

Basic or 'no frills' loans

Many lenders offer a class of home loan which has a lower variable interest rate than their standard variable rate loan. The trade off is that these discount loans generally have less flexibility and fewer features, eg. no extra repayments can be made, the repayment level cannot be varied or no redraw is available.

Basic Rate

Applied to loans commonly called ‘No Frills Loans’ which are generally cheaper than Standard Variable Rate Loans but do not have features such as a redraw facility or mortgage offset.

Break Costs

Relates to the penalty fees charged when a borrower terminates a fixed-rate loan contract before the expiry of the fixed-rate period

Bridging Finance

A short term Loan that covers a financial gap between the purchase of a property and the sale of a current property.