All lenders have a standard variable rate which is their benchmark rate or the interest rate they use to advertise their products. However, definitions for a standard variable rate differ from lender to lender because there is no set law or regulation to determine the criteria.
Another measure to review is the comparison rate. The comparison rate includes other additional fees and charges such as ongoing monthly or yearly fees and upfront fees such as application or establishment fees that you may incur depending on the loan.
With that in mind, you may not necessarily be offered a standard variable interest rate when choosing a home loan because the rate you are given is determined by several factors including:
- The amount you borrow
- The value of the property
- Your credit history
It will also depend of the features and services you require for your home loan and the package you choose. For instance, some lenders have a basic rate which comes with minimal or basic features and lenders may have a standard variable rate package which includes all the features a home loan can incorporate.
To see how much your repayments might be on different variable rates over different home loan lengths you can use Ratecity’s free Australian home loan calculator. You can also compare variable rate home loans and fixed rate home loans to find a great home loan to suit your circumstances.