What type of lender should I go with?
Home loan lenders all have to abide by the same strict guidelines and laws. This makes choosing between the a bank, a not-for-profit credit union or an online or non-bank lender a matter of savings and personal preference.
Banks
A bank is an institution where you can deposit and withdraw funds. They also offer loans, including home loans.
Banks have larger client bases than other lenders, so offer more products. These include longer fixed term lengths and loans for low doc borrowers.
Another benefit of using a bank is that they usually have branches for you to do your banking in person.
Not-for-profit credit unions
Unlike a bank, a credit union is owned by its members
This means profits earned go back into the union to improve products.
Credit unions generally won’t have the large product ranges a bank does. Instead, they’ll offer the most popular home loans.
In some cases a credit union might also limit their products to workers in a specific industry, such as teachers or university employees.
Online or non-bank lenders
Online lenders often offer competitive rates and products. This is because they don’t have to pay for the physical branches a regular lender has to. This has a downside, as you’ll usually only be able to carry out your banking over the phone or online.
Many of these lenders are in fact brands of larger well known banks. UBank for example is an online brand of NAB, and loans.com.au is a Firstmac brand.