With interest rates dropping to historic lows, many Australians are eager to take advantage of the market by refinancing their existing loans or jumping into homeownership.

The low rates are appealing, and certainly put borrowers at a great advantage, but it’s important to remember that the lowest rate isn’t always going to be the best.

A mortgage is more than just a number, and many home loan deals come with extras that can actually save you more money than going for the lowest percentage. When looking at your mortgage options it’s important to consider your finances, personal situation, and the future of the property market.

Compare for the best deal

While rates are low now, nothing guarantees they will stay that way forever, so if you’re looking at getting a loan choosing whether to go fixed or variable can make a big difference in your long-term savings.

It’s important to remember that cheapest isn’t always best – you can get a lot out of the additional features that come with some loans; having an offset account or the ability to make additional repayments or redraw can be valuable tools when it comes to savings and financial planning. Look at loans that don’t only suit the market now, but also allow you to be flexible when the market changes.

The quicker, the better

The average loan term is 25-30 years, and most borrowers will go for a loan with a similar term without a second thought. And why wouldn’t they? The longer the term the smaller your repayments will be, meaning more money to spend on the things you enjoy.

But paying less now can really cost you in the long run – the longer it takes you to pay off your loan the more interest you’ll end up paying over the life of the loan. Going for the shortest loan term you can afford is wise advice for most borrowers.

Talk to an expert

Talking to a broker is a great first step to understanding what’s out there and what will work best for you. Brokers often have access to special deals and rates not advertised to borrowers directly and will compare rates across multiple lenders for you.

It doesn’t hurt to look at the loans advertised online too, to give yourself a better idea of what’s out there and what sort of rates and offers you can expect as a baseline.