When it comes to asking which Australian bank is best for a home loan, lenders have their own strengths, limitations and requirements. This means it’s important to shop around to find the best fit for your unique financial situation. At eChoice, we’re passionate about ensuring you make the right choice from the get go, and that means empowering you with knowledge of the different options available to you. So, in this article, we’re putting NAB home loans under the microscope.
As a major bank, NAB is able to offer a range of home loans to customers, including competitive products for the $1 million-plus home loans. While still relatively conservative, compared to the other major banks, NAB is a bit more lenient in their lending policy, accepting loans from those with no genuine savings or a low deposit. They also have special deals for doctors and dentists. Despite this, those with low credit tend to find it difficult to get approval. Thinking of applying for an NAB Home Loan? Here’s everything you need to know:
Usually, it’s easiest to successfully apply for a home loan with NAB if you have a deposit of over 20%. However, provided you fit the rest of the criteria, they do accept deposit for as little as 5% with their NAB Tailored Home Loan package. If you do take up this deal, it’s important to keep in mind that you will be required to pay LMI (lender’s mortgage insurance), as well as an application fee of around $600.
The best way to determine the minimum deposit you would need for an NAB home loan is to use their ‘how much can I borrow’ calculator.
This is one of NAB’s more flexible home loan packages, giving customers the option to make their payments weekly, fortnight or monthly. They also allow you make free extra repayments of up to $20,000. If necessary, these repayments can then be accessed through their redraw facility.
The home loan also features a 100% offset account, designed to reduce the interest you pay. You can also choose between variable, fixed or split for the NAB Tailored Home Loan. While it has many desirable features, it’s important to be aware of the fees involved, which includes an $8 monthly fee and $350 exit fee as well a $600 application fee.
When you apply for a mortgage with NAB, you will generally be contacted by a home loan specialist who will run through things over the phone, which usually takes between 30 and 60 minutes. If everything seems to be in order and you’re eligible, you will then be given conditional approval. From here, you will get a conditional approval document in the mail, valid for 90 days. You will need to then get formal approval, which involves having the property value and submitting all necessary documentation. This process can take about two weeks until your home loan is officially accepted.
Like most other lenders, NAB charges a mortgage discharge fee if you choose to end the loan or refinance.
NAB charges a $350 discharge or settlement fee when you exit your home loan. This is the same as Commonwealth Bank and Westpac charge, while ANZ charges $160.
While we wouldn’t recommend making a habit of it, NAB offers repayment holidays to eligible customers. These allow you take a few months off home loan repayments. If you are having financial difficulties, it’s best to advise them as early as you can so they can make necessary arrangements.
As a bank, NAB offers financial products and services at more competitive rates and with reduced fees for their employees. Their employee program includes offers on home loans as well as investments, credit cards, insurance, financial planning and more. If you are an employee or are thinking of becoming one, it’s best to chat with your HR department to see what you’re eligible for.
NAB allows you to register for Smart Statements, which gives you access to your statements online rather than via mail. With this feature, you can view, download and save statements from the last seven years online. You can register for NAB Smart Statements within NAB Internet Banking by selecting ‘account info’ menu and ‘view statements’ from the drop-down menu.
When you pay more than the minimum amount on your home loan, NAB allows you to redraw. This can reduce the time you spend paying back your loan and reduce your interest rate. You can also access the extra money you’ve put away for things like emergencies, investments or purchasing another property. To check if you’re eligible for redraw on your home loan, or to check how much available, check NAB internet banking. After this, you can redraw directly through the website, or by calling NAB or visiting your local branch.
The amount you can withdraw on a NAB home loan starts at $500, all the way up to $150,000. Typically, you can access all the funds you’re ahead by, minus one month’s scheduled repayment.
NAB doesn’t have a home loan that facilitates a 4-way split, however, they do offer split loans. This allows you to have two smaller loans that add up to your total loan amount – one fixed rate and one variable. For example, if you’re borrowing $500,000 you could have $300,000 as fixed and $200,000 as variable. This gives you the stability of fixed repayments while still giving you access to an offset account.
No, NAB doesn’t offer zero deposit home loans. The lowest deposit they will accept is a 5% deposit with their NAB Tailored Home Loan. However, you may be able to get around this with a NAB family guarantee. This is when your parents, or other relatives such as grandparents, use the equity in their own property as security for your loan.
The NAB interest rate depends on which kind of home loan you are applying for and whether it’s fixed or variable. For home buyers, their lowest rate is the NAB Choice Package Home Loan – a 2-year fixed (owner occupier P&I) first home buyer special, which has a 3.09% p.a. interest rate and lets you borrow up to 90%.
On the other end of the spectrum is the FlexiPlus Mortgage package, which involves getting a line of credit. This has an interest rate of 6.16% p.a.