What is the difference between a principal and interest home loan and an interest-only home loan?
With a principal and interest loan, your repayments cover the amount you borrowed from the bank as well as the interest you are being charged on top. Paying both simultaneously means you will pay off your loan sooner.
An interest only loan requires you to pay the interest charged on your loan only, but for a limited period of time (usually between 1-10 years, depending on whether you're an owner-occupier or an investor). While this can reduce financial pressure early on, you won't be making any progress towards repaying the actual cost of your loan. At the end of the interest only period, you will need to pay both principal and interest for the remainder of the loan term.
Speak to a Lendi Home Loan Specialist to see which home loan is right for you.