Property Purchase Loans
What Loan Term Can You Get?
5 min read- Finance Guide
- Updated 2026
Quick answer
Most property loans run up to
30 years
Subject to age, policy and servicing
- Common maximum term Up to 30 years
- Shorter term effect Higher repayments
- Longer term effect More interest overall
1300 421 044
1300 421 044
Detailed explained
Loan term is the period over which the debt is scheduled to be repaid. For a standard property purchase loan, lenders commonly structure principal and interest lending over up to 30 years, although the final term offered can be shorter where borrower age, policy limits, interest only periods or servicing considerations apply.
How loan term is structured
-
Many residential property loans are commonly written for up to 30 years, especially for owner occupier and investment purchases
-
A shorter term can sometimes be required if the borrower is closer to retirement or the lender wants the debt repaid within a tighter timeframe
-
Interest only loans may have an initial interest only period, after which the remaining debt must amortise over the residual term
-
The longer the term, the lower the minimum repayment usually appears, but the higher the total interest cost can become over the life of the loan
-
-
TERM SNAPSHOT
-
Common maximum term
up to 30 years
-
Shorter tailored term
sometimes required
-
-
Term affects servicing
A shorter repayment window can reduce assessed borrowing power because the required repayments are higher
How lenders decide the term
Borrower profile
01
Age, income stability and overall risk position can influence whether the maximum term is available
Repayment type
02
Principal and interest and interest only structures can lead to different effective repayment periods
Servicing test
03
The lender checks whether you can afford repayments based on the selected term and its assessment rate
Policy decision
04
Formal approval reflects the term the lender is willing to offer after reviewing policy, risk and repayment capacity
What lenders look at
Borrower age
Age can influence whether a full 30 year term is available or whether a shorter term is preferred
Income and servicing strength
The lender tests whether repayments remain affordable across the selected term
Repayment structure
Principal and interest and interest only loans can produce different repayment paths
Loan purpose
Owner occupier and investment lending may be treated differently depending on policy and structure
Exit strategy at older ages
Some lenders want a clear repayment or retirement strategy where the term extends into later life
Overall policy fit
Final term is based on lender policy, not just the borrower’s preference for lower repayments
Serviceability buffer remains in place
APRA continues to require lenders to assess borrowers with a mortgage serviceability buffer of 3 percentage points above the loan rate, which can affect what term and repayment level comfortably fits servicing
Need Help with your Project?
How term affects the life of the loan
-
01. A longer term usually reduces the required repayment at the start
-
02. A shorter term generally increases repayments but can reduce total interest paid
-
03. If an interest only period applies, the remaining principal has to be repaid over the balance of the term
-
04. When refinancing, borrowers should be careful not to reset the term longer than necessary because that can increase long run interest cost
Common problems
Loan term sounds simple, but issues can arise where the borrower wants the longest possible term while the lender is focused on age, risk, future repayment ability and policy fit.
Repayments too high on a shorter term
If the lender will not allow the full term, the monthly repayment may rise and reduce borrowing power.
Possible solutions include:
Reduce the loan size- Increase the deposit or equity contribution
- Review whether a different lender has more suitable policy
- Restructure the deal with clearer affordability
Older borrower policy issues
Some applications face extra scrutiny where the requested term extends well into retirement years.
Possible solutions include:
- Provide a clear retirement or exit strategy
- Show strong asset backing or super position where relevant
- Use a shorter, more realistic requested term
- Match the application to lenders comfortable with the profile
Resetting the term too long
A long term can feel easier month to month, but it may significantly increase total interest if not managed carefully.
Possible solutions include:
- Compare total interest cost, not just minimum repayment
- Use extra repayments where the product allows
- Keep the term aligned with your actual repayment plan
- Review fixed, variable and offset features together with the term
Steps to get Finance
Step
01
Estimate what repayment range is comfortable before choosing the term.
Step
02
Review whether the term should be principal and interest from day one or include an interest only period.
Step
03
Check how the selected term affects borrowing capacity and policy fit.
Step
04
Submit the application with supporting documents and the proposed repayment structure.
Step
05
Review the formal approval to confirm the final approved term, repayment type and conditions.
Step
06
Proceed with a term that balances affordability now with total cost over the life of the loan.
Speak with a Property Finance Specialist
The right loan term is not only about what a lender will approve. It is also about choosing a structure that fits your cash flow, long term goals and total cost of debt.
A specialist can compare lender policy, repayment options and strategy to help identify a term that suits the property purchase rather than simply stretching the loan as long as possible.
Speak with a finance specialist about your property loan term options
Submit the short form below and a property finance specialist will review your scenario and discuss possible loan term and repayment structures.
Contact Form
Your enquiry is confidential
Prefer to speak with someone directly ?
Call us to discuss your property finance questions
Additional Questions
You may also find these questions helpful
