Nila Sweeney

While the comparison rate can be a useful tool, Your Mortgage has gone even further and developed its own method to uncover the true cost of a mortgage.

The team at Your Mortgage compared all 27 (nine bank and 18 non-bank) introductory loan products in our books by taking into account each and every fee, including upfront, ongoing and deferred establishment fees, as at 7 January 2008.

By working out how much a given loan will cost you after a range of time periods - three, five and 10 years - we show you the impact that these fees can have on the total cost of your mortgage. By adding all fees to the cost of principal and interest (P&I), we calculate the true cost of a mortgage over three, five and 10 years. This month, we based our calculation on a loan amount of $300,000 at 80% LVR taken over 30 years.

And the winner is...
The Editor's Choice award for the best value introductory loan in the bank category in Australia goes to ANZ Easy Start 1 Year Variable.

With interest rates set initially at an attractive 7.25%, the loan comes out $2,441 cheaper compared to the average loan in our books if you hold it past the three-year mark. The revert rate is also competitive at 8.17%. The ANZ Easy Start 1 year could save you $4,181 over the five-year period and $8,787 over 10 years. This product also has an intro period of 12 months.

Nationwide Mortgage New Start Home Loan has won the top spot for best introductory loan in the non-bank category, thanks to its low interest rates and competitive fees.

The attractive interest rate of just 7.24% that reverts to a low 8.04% could save you $2,191 over three years compared to the average loan in our database. Even with a total upfront fee of $654 and an exit fee of $2,339, the loan is still cheaper compared to the average loan in the same category. After five years, you could save $4,963 as the exit fees drop to $295.

For the complete list of top ranking introductory rate loans, read the latest issue of Your Mortgage magazine, on sale now.


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