Regardless of whether you are building a new home or buying an existing property, taking out a home loan is probably one of the biggest decisions that most people will make in their lifetime.

It requires a commitment to the task of repaying the loan, and represents one of the largest purchase decisions people are ever likely to make. Most importantly however, it represents the opportunity for people to own their own property rather than continuing to pay rent, and provides a secure investment for the future.

So what should people know and look for when deciding to take out a Home Loan?

It is always a good idea to ask about all of the fees and charges payable up-front, not just the interest rate on the loan. Recent legislation makes it compulsory for lenders to disclose a “Comparison Rate” which allows borrowers to make a more accurate comparison between credit providers.

Be prepared to ask questions and always read the “fine print” when it comes to the full terms and conditions of your loan.

You should also consider your exposure to the risk of interest rate increases.If the interest rate on your loan was to suddenly rise, could you still afford the repayments?

Variable rate loans usually offer the most competitive rate, but are prone to changes and uncertainty should the market suddenly shift.

The solution may be a fixed term rate on your loan. Locking your loan in on a fixed term rate provides you with the security and peace of mind of knowing that regardless of interest rate fluctuations and changes, the rate applicable to your loan will always remain constant for the nominated fixed term period. In this way, you will never have a sudden and unwelcome increase in repayments on your loan.

Alternatively, you may even wish to split your loan between a fixed and variable rate for a period of time.

Location is another important factor. Remember that one day you will probably want to sell your home, so it is important that your property is going to be marketable in the future, and that the value of the property is going to appreciate over time.