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If you’ve been searching for a home loan, chances are you’ve come across home loan packages, also known as package home loans. Home loan packages can be alluring for borrowers because they often seem more convenient and even cheaper than regular home loans.

It’s important to get the full picture when it comes to home loan packages. In this article, we’ll explain what a home loan package includes and the various benefits and drawbacks, so you can decide if getting a packaged home loan is right for you.

- __Related: [Buying a property? How to be the ideal borrower and get approved for a home loan](https://www.lendi.com.au/inspire/finance/how-to-be-the-ideal-borrower-get-approved-for-home-loan/)__
- __Related: [How much interest do you actually pay over the life of your home loan?](https://www.lendi.com.au/inspire/finance/how-much-interest-you-pay-over-life-of-loan/)__

## What is a home loan package?

A home loan package is a home loan bundled with various other financial products at a discounted interest rate or with fewer fees for each product. So, you end up with a ‘package’ of products alongside your home loan, all with the same lender.

A home loan package can include financial products like:

- Credit cards
- [Offset accounts](https://www.lendi.com.au/inspire/finance/how-to-use-your-offset-account-to-save-money/)
- Bank accounts, both transaction and saving
- Insurance policies
- Share trading
- Financial planning
- [Insurance policies](https://www.lendi.com.au/inspire/finance/what-does-home-insurance-cover/) like home and contents insurance, car insurance and health insurance.

Home loan packages are usually only available on principal and interest loans but both owner occupiers and investors will find package loans available to them. You’ll also be able to find home loan packages for both [variable interest rate and fixed interest rate](https://www.lendi.com.au/inspire/finance/understanding-split-vs-fixed-or-variable-home-loans/) loans.

## How much do home loan packages cost?

If you take out a package home loan, you’ll be charged an ongoing annual fee, rather than multiple fees for each individual product included in the package. This fee is usually around $400 per year but can be as high as $700. By comparison, standalone home loans don’t usually attract an annual fee.

However, you may also receive a discounted interest rate on your home loan. This means you may pay an interest rate which is lower than what borrowers on a standalone home loan with the same lender pay.

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## What are the benefits of a home loan package?

- Convenience: package home loans allow you to keep your home loan, banking products and credit card (as well as other financial products like insurance) all with one lender
- Saving money on products: while this isn’t guaranteed, lenders will often discount products like insurance or even your home loan interest rate as part of a home loan package. This means you could potentially be paying less for these products than if you had bought them separately
- Paying less in fees: package home loans charge one annual fee, eliminating individual fees for each product in the package. This means you could pay less in fees overall.

## What are the drawbacks of a home loan package?

- You may not have the best rates available: although lenders often discount interest rates and other products as part of a package deal, it’s possible there are more competitive interest rates available on standalone home loans and credit cards, for example
- You could end up with products you don’t use: it’s possible to get drawn in by discounted rates and end up with credit cards or insurance products that you won’t use
- They can discourage you from refinancing: if you have all of your lending and banking products with the one lender, refinancing for a better rate or more suitable product may seem headache-inducing, so you might be less likely to switch 
- You might end up paying more in fees: although it’s possible to save in fees with a home loan package, the annual package fee may cause you to pay more in the long term than borrowers with a lower fee on a standalone mortgage.

%%How much can you save with an offset account?%%

## Are home loan packages worth it?

This totally depends on your personal needs and wants, but there are a few things you should consider when making a decision about whether or not a package home loan will suit you.

For a start, weigh up the pros and cons of home loan packages outlined above. Maybe you don’t mind paying a bit extra in fees for the convenience of having most, if not all of your financial products in the one place. Or, maybe you’d prefer to only take out products that you’ll definitely use, making a standalone home loan without extra products attached the best option for you.

Also, you’ll need to review the fees and charges associated with a home loan package closely to see if the annual package fee will outweigh the savings from having a discounted interest rate on your home loan or waived fees on products like bank accounts.

It’s important to pay attention to comparison rates when you’re looking at package home loans. While the idea of a discounted interest rate on your home loan might be enticing, the comparison rate – which estimates the total costs you’ll pay on your loan on top of the principal, plus other fees and charges – could tell a different story. Make sure you compare home loan package comparison rates to standalone home loan comparison rates to see if you really are getting a better deal.

If you do take out a package home loan, it’s still a good idea to keep observing interest rate trends and current home loan deals on offer by other lenders. This way, you can ensure your deal is still competitive, and if it’s not, you can consider [refinancing](https://www.lendi.com.au/inspire/finance/the-refinancing-process-how-it-works/) so that you [don’t overpay](https://www.lendi.com.au/inspire/finance/how-to-avoid-overpaying-on-your-mortgage-2022/). While it may seem too difficult when all of your finances are with one lender, refinancing to get yourself a better deal doesn’t have to be a stressful task.

Are you thinking about getting a home loan package? Our friendly Home Loan Specialists are here to help you weigh up your options at a time that suits you – [just book an appointment](https://www.lendi.com.au/book-appointment/).

## What could your home loan repayments look like?

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## Got a home loan question? Just ask!
We're here to help. Get free expert advice at a time that suits you. Choose a time to chat with a [Home Loan Specialist here](https://www.lendi.com.au/book-appointment/)

*The information in this post is general in nature and should not be considered personal or financial advice. You should always seek professional advice or assistance before making any financial decisions.*