Table loans
Regular repayments, unless your interest rate changes.
Most people choose this type of mortgage. Your regular repayments are the same each week, fortnight or month, unless your interest rate changes.
Here’s how it works
Every repayment includes a combination of interest and principal. At first, your repayments comprise mostly interest but as the amount you still owe begins to decrease, your regular repayment will include less interest and repay more of the principal (the amount you borrowed). Most of your later mortgage repayments go towards paying back the principal.
With a table loan you can choose a fixed rate of interest or a floating interest rate. With most lenders you can select a term (how long you’ll take to repay the loan) of up to 30 years.
For and against
For: Table loans can help to keep you on track because they have regular repayments and a set date by which the loan will be paid off. They provide the certainty of knowing what your mortgage repayments will be (unless your mortgage rate changes, in which case repayment amounts can change).
Against: Fixed regular repayments might be difficult to make if you have an irregular income.
