Choosing helpful home loan features.
Home loan features can make a meaningful difference to how efficiently you manage your loan, reduce interest, and maintain flexibility over time. The right features depend on your spending habits, savings pattern, and future plans — not every feature suits every borrower.
At Lumo, we help clients choose features that align with their lifestyle rather than adding unnecessary complexity. Below is a clear breakdown of the most common features and how they may benefit you.
Offset accounts
An offset account is a transaction account linked to your home loan. Any money you keep in the offset reduces the interest charged on your loan balance.
Why offsets are useful
Helps reduce interest without locking funds away
Works seamlessly with everyday banking
Offers flexibility for savings, budgeting, or future planning
Can shorten your loan term when used consistently
Who they suit
Offset accounts benefit borrowers who maintain regular savings or keep money in their account between pay cycles.
Redraw facilities
Redraw gives you access to any extra repayments you've made on your loan. Instead of sitting in a separate savings account, those funds sit inside the loan — reducing daily interest — but remain available if you need them.
Why redraw is helpful
Reduces the principal owing while funds stay accessible
Encourages disciplined saving
Helpful for ad-hoc expenses like renovations or emergencies
Who they suit
Borrowers who prefer automated extra repayments and do not need constant access to those funds.
Fixed and variable rate options
Most lenders offer both fixed and variable interest rates, and in many cases you can split your loan between the two.
Fixed rate features
Certainty of repayments for a set period
Useful for budgeting and managing cash flow
Variable rate features
Flexibility with extra repayments
Potential access to offset
Rates may rise or fall with the market
Splitting your loan
A split loan allows you to hold part of your loan on a fixed rate and part on a variable rate, balancing certainty with flexibility.
Multiple loan splits
Some borrowers benefit from dividing their loan into separate sub-accounts. This helps with:
Budgeting
Separating personal expenses from investment purposes
Planning for renovations or future upgrades
Managing tax-deductible vs non-deductible debt
Multiple splits create structure around how you borrow and repay.
Repayment flexibility
Key flexible features include:
Extra repayments
Paying more than the minimum helps reduce your interest substantially.
Repayment frequency
Weekly or fortnightly repayments can reduce the overall interest paid compared to monthly (depending on lender calculation methods).
Interest-only periods
Useful for investors or certain cashflow strategies, though interest-only terms change how the loan reduces over time.
Portability
Some lenders allow you to transfer your home loan to a new property without fully refinancing. This can:
Save on certain fees
Streamline the moving process
Help maintain the same loan structure
Portability is helpful when upgrading or relocating, though it doesn't suit every scenario.
Choosing the right feature mix
The best loan isn’t the one with the most features — it’s the one with the most relevant features.
At Lumo, we consider:
How you manage money day-to-day
Whether you save consistently
Whether you plan renovations or investments
Whether certainty or flexibility is more important
Long-term financial goals
Understanding these factors helps us match you to a loan that works now and keeps working as life changes.
Let’s chat.
Want help choosing the right mix of features for your budget, lifestyle, and goals? At Lumo, we compare options clearly so you only pay for features you’ll actually use. Let’s chat.
This page provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. Subject to lenders terms and conditions, fees and charges and eligibility criteria apply.