Important disclosure
Compare the cheapest home loans
The cheapest home loan will be one with the lowest rates and low fees. Consider the purpose of your home loan and the features that are important. Search and compare to find the home loan ideal for you.
Find and compare the cheapest home loans
Product Smart Booster Home Loan Discounted Variable - 2yr Real Time Rating™ | Interest Rate 2.10 % p.a Intro 24 months | Comparison Rate* 2.46 % p.a | Company Promoted | Repayment $1,346 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | Buyers and refinancers can benefit from this special discounted rate, plus no ongoing fees and optional access to an offset account. | Highlighted | ||
Product Low Rate Home Loan - Prime (Owner Occupied) (Principal and Interest) Real Time Rating™ Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | Interest Rate 2.14 % p.a Variable | Comparison Rate* 2.14 % p.a | Company Promoted | Repayment $1,292 monthly | Features Redraw facility Offset Account Borrow up to 60% Extra Repayments Interest Only Owner Occupied | Go to site | Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | Do you have 40% deposit or equity available? Pay no ongoing fees and enjoy access to extra repayments and a redraw facility for your owner-occupied home loan. | ||
Product Variable Home Loan Real Time Rating™ | Interest Rate 2.09 % p.a Variable | Comparison Rate* 1.99 % p.a | Company Promoted | Repayment $1,285 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | special Receive $5,000 AUD cashback when you refinance your existing home loan ~ Ends in about 1 month | Owner occupiers can enjoy a competitive interest rate and avoid upfront and ongoing fees with this variable rate home loan. | ||
Product Yard Home Loan (Special) Real Time Rating™ Winner of Best Variable Home Loan, RateCity Gold Awards 2022 | Interest Rate 1.99 % p.a Variable | Comparison Rate* 2.02 % p.a | Company Promoted | Repayment $1,270 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | special Yard’s low-rate variable special home loan ~ Ends in 9 daysWinner of Best Variable Home Loan, RateCity Gold Awards 2022 | The special discounted variable interest rate on this online-only home loan is available for a limited time only, charging no ongoing fees. | ||
Product Star Gold Home Loan Real Time Rating™ Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | Interest Rate 1.79 % p.a Variable | Comparison Rate* 1.84 % p.a | Company | Repayment $1,241 monthly | Features Redraw facility Offset Account Borrow up to 60% Extra Repayments Interest Only Owner Occupied | Go to site | Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | |||
Product Well Balanced Real Time Rating™ Winner of Best Variable Home Loan, RateCity Gold Awards 2022 | Interest Rate 1.85 % p.a Variable | Comparison Rate* 1.88 % p.a | Company | Repayment $1,250 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | Winner of Best Variable Home Loan, RateCity Gold Awards 2022 | |||
Product Neat Home Loan Real Time Rating™ | Interest Rate 1.89 % p.a Variable | Comparison Rate* 1.90 % p.a | Company | Repayment $1,256 monthly | Features Redraw facility Offset Account Borrow up to 60% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Well Balanced Real Time Rating™ | Interest Rate 3.45 % p.a Fixed - 1 year | Comparison Rate* 2.02 % p.a | Company | Repayment $1,494 monthly | Features Redraw facility Offset Account Borrow up to 90% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Investment Neat Home Loan Real Time Rating™ | Interest Rate 2.14 % p.a Variable | Comparison Rate* 2.15 % p.a | Company | Repayment $1,292 monthly | Features Redraw facility Offset Account Borrow up to 60% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Yard Investor Bundle Loan Real Time Rating™ | Interest Rate 2.15 % p.a Variable | Comparison Rate* 2.18 % p.a | Company | Repayment $1,294 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Well Balanced Real Time Rating™ Winner of Best Investor Home Loan, RateCity Gold Awards 2022 | Interest Rate 2.17 % p.a Variable | Comparison Rate* 2.20 % p.a | Company | Repayment $1,297 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | Winner of Best Investor Home Loan, RateCity Gold Awards 2022 | |||
Product Back to Basics Home Loan Special Offer Real Time Rating™ | Interest Rate 2.19 % p.a Variable | Comparison Rate* 2.20 % p.a | Company | Repayment $1,299 monthly | Features Redraw facility Offset Account Borrow up to 70% Extra Repayments Interest Only Owner Occupied | Go to site | Cashback Receive $3,000 cash when you take out a Suncorp Bank home loan of $750K or more with LVR <=90%. Apply by 31 June 2022, settle by 30 September 2022. Unless withdrawn prior. T&Cs & eligibility criteria apply. ~ Ends in about 1 month | |||
Product Yard Investor Loan Real Time Rating™ Winner of Best Investor Home Loan, RateCity Gold Awards 2022 | Interest Rate 2.19 % p.a Variable | Comparison Rate* 2.22 % p.a | Company | Repayment $1,299 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | Winner of Best Investor Home Loan, RateCity Gold Awards 2022 | |||
Product Low Rate Home Loan - Prime (Owner Occupied) (Principal and Interest) Real Time Rating™ Winner of Best Home Loans Over 1m, Best Variable Home Loan, RateCity Gold Awards 2022 | Interest Rate 2.24 % p.a Variable | Comparison Rate* 2.24 % p.a | Company | Repayment $1,307 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | Winner of Best Home Loans Over 1m, Best Variable Home Loan, RateCity Gold Awards 2022 | |||
Product Low Rate Home Loan - Prime (Owner Occupied) (Interest Only) Real Time Rating™ | Interest Rate 2.44 % p.a Variable | Comparison Rate* 2.24 % p.a | Company | Repayment $610 monthly | Features Redraw facility Offset Account Borrow up to 60% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Ocean Owner Occupied Variable (No Annual Fee) Real Time Rating™ Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | Interest Rate 2.16 % p.a Variable | Comparison Rate* 2.27 % p.a | Company | Repayment $1,295 monthly | Features Redraw facility Offset Account Borrow up to 60% Extra Repayments Interest Only Owner Occupied | Go to site | Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | |||
Product Low Rate Home Loan - Prime (Investment) (Principal and Interest) Real Time Rating™ | Interest Rate 2.29 % p.a Variable | Comparison Rate* 2.29 % p.a | Company | Repayment $1,314 monthly | Features Redraw facility Offset Account Borrow up to 60% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Well Balanced Real Time Rating™ | Interest Rate 4.42 % p.a Fixed - 2 years | Comparison Rate* 2.32 % p.a | Company | Repayment $1,654 monthly | Features Redraw facility Offset Account Borrow up to 90% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Low Rate Home Loan - Prime (Owner Occupied) (Interest Only) Real Time Rating™ | Interest Rate 2.54 % p.a Variable | Comparison Rate* 2.34 % p.a | Company | Repayment $635 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site | ||||
Product Mortgage Simplifier Real Time Rating™ | Interest Rate 2.34 % p.a Variable | Comparison Rate* 2.37 % p.a | Company | Repayment $1,322 monthly | Features Redraw facility Offset Account Borrow up to 80% Extra Repayments Interest Only Owner Occupied | Go to site |
Learn more about home loans
Everybody looking for a home loan wants to save money but doing so isn’t as simple as it might seem at first. To find the cheapest home loans you will need to understand the ways in which different loans work.
How to find Australia’s cheapest mortgages
To find one of the cheapest home loans for you, you will need to consider several different aspects of those available. Sometimes a loan offering low interest rates will entail high fees, meaning that you would be paying more overall than for a loan with a higher rate. Sometimes paying off a loan more quickly will mean spending less overall, even if the interest rate is higher.
How your personal circumstances affect what is cheapest
Whenever you take out a loan you need to think carefully about your personal circumstances. This isn’t just about avoiding financial difficulties; it’s about saving money. For instance, your income will affect the amount of risk you can afford to take, and as a rule higher-risk options are cheaper. You will also need to prioritise between lower monthly payments and a lower overall cost.
- Low interest rates
The first thing people look for when comparing the coast of loans is the basic interest rate. The cheapest rates tend to be on variable rate loans but these will not necessarily stay cheap – they could rise if the national interest rate rises. Finding a low interest rate is more important if you expect to pay off the loan over a longer period of time. If you plan to pay it off over a shorter term, the interest rate should be lower in your scale of priorities when you’re working out which loan is cheapest for you.
- Low fees
Most home loans include fees that you will need to consider when working out the overall cost. These include upfront arrangement fees and ongoing administration fees, which are often charged on an annual basis. Sometimes cashback is available when you are accepted for a loan, which will reduce your costs, but you must always make sure your lender tells you clearly what fees apply.
- The loan period
Many lenders will try to lock you into a specific loan period when offering you what looks like a cheap deal. If you would be capable of paying back the loan more quickly (without placing yourself at financial risk) then this can be a problem. It effectively makes the loan more expensive because even if the monthly charges are lower you’ll be paying interest over more months, and this will add up.
- Money saving features
Many loans offer additional features that can save you money if you know what you’re doing. An offset account, for instance, can enable you to reduce the overall amount of interest you pay on your loan. The option to make additional payments at no charge means you may be able to save money by paying the loan off more quickly, and loan portability means you won’t be hit by extra charges if you move house before the loan period ends.
* The phrase ‘one of the cheapest’ is not a recommendation or rating of products. This page compares a range of home loans from selected providers, not all products or providers are included in the comparison. No home loan is one size fits all. As a result, it's worth getting advice on whether a product is right for you before committing.
Latest news and articles
Mark Bristow
Personal Finance Editor
Mark Bristow is RateCity's Home & Personal Finances Editor, and an experienced analyst, researcher, and producer. Working for over ten years, Mark previously wrote and researched commercial real estate at CoreLogic, and has seen articles published at Lifehacker and Business Insider, among others.
Frequently asked questions
How do you find cheap home loans?
With so many interest rate options and repayment types available, finding the cheapest home loan may depend on the type of loan you choose.
Whether you’re looking for an owner-occupier or investor loan, with interest-only or principal and interest repayments, on a fixed or variable interest rate, the cheapest home loan rate available may vary greatly.
One way to find the cheapest option for you is to narrow down your search and compare the options that best suit your individual requirements. RateCity’s home loan comparison tables can help you get started on your search and take the hassle out of shopping around.
Is the lowest home loan rate always the cheapest?
The home loan with the lowest interest rate may not always be the cheapest mortgage option for you. Sometimes a home loan with a low interest rate may charge high fees, which may cost more in total than a mortgage with a higher interest rate and no fees.
Consider checking the comparison rate, which combines interest and standard fees, to get a better idea of the overall cost of different home loan options.
Are fixed rates or variable rates cheaper?
Fixed and variable home loan interest rates are discretionary based on the lender’s decision. They will also be influenced by the Australian economy, as well as the Reserve Bank of Australia’s cash rate. The specific interest rate you may be offered will also depend on your credit history and financial situation.
Whether a fixed or variable rate home loan is the cheaper option for you will depend on all the above, and may still fluctuate over a 25-year home loan term. Therefore, it’s worth comparing your loan options with our comparison tables to see how the rates compare, based on your specific financial needs.
Who has the best home loan?
Determining who has the ‘best’ home loan really does depend on your own personal circumstances and requirements. It may be tempting to judge a loan merely on the interest rate but there can be added value in the extras on offer, such as offset and redraw facilities, that aren’t available with all low rate loans.
To determine which loan is the best for you, think about whether you would prefer the consistency of a fixed loan or the flexibility and potential benefits of a variable loan. Then determine which features will be necessary throughout the life of your loan. Thirdly, consider how much you are willing to pay in fees for the loan you want. Once you find the perfect combination of these three elements you are on your way to determining the best loan for you.
Can I take a personal loan after a home loan?
Are you struggling to pay the deposit for your dream home? A personal loan can help you pay the deposit. The question that may arise in your mind is can I take a home loan after a personal loan, or can you take a personal loan at the same time as a home loan, as it is. The answer is that, yes, provided you can meet the general eligibility criteria for both a personal loan and a home loan, your application should be approved. Those eligibility criteria may include:
- Higher-income to show repayment capability for both the loans
- Clear credit history with no delays in bill payments or defaults on debts
- Zero or minimal current outstanding debt
- Some amount of savings
- Proven rent history will be positively perceived by the lenders
A personal loan after or during a home loan may impact serviceability, however, as the numbers can seriously add up. Every loan you avail of increases your monthly installments and the amount you use to repay the personal loan will be considered to lower the money available for the repayment of your home loan.
As to whether you can get a personal loan after your home loan, the answer is a very likely "yes", though it does come with a caveat: as long as you can show sufficient income to repay both the loans on time, you should be able to get that personal loan approved. A personal loan can also help to improve your credit score showing financial discipline and responsibility, which may benefit you with more favorable terms for your home loan.
How do I apply for a home improvement loan?
When you want to renovate your home, you may need to take out a loan to cover the costs. You could apply for a home improvement loan, which is a personal loan that you use to cover the costs of your home renovations. There is no difference between applying for this type of home improvement loan and applying for a standard personal loan. It would be best to check and compare the features, fees and details of the loan before applying.
Besides taking out a home improvement loan, you could also:
- Use the equity in your house: Equity is the difference between your property’s value and the amount you still owe on your home loan. You may be able to access this equity by refinancing your home loan and then using it to finance your home improvement. Speak with your lender or a mortgage broker about accessing your equity.
- Utilise the redraw facility of your home loan: Check whether the existing home loan has a redraw facility. A redraw facility allows you to access additional funds you’ve repaid into your home loan. Some lenders offer this on variable rate home loans but not on fixed. If this option is available to you, contact your lender to discuss how to access it.
- Apply for a construction loan: A construction loan is typically used when constructing a new property but can also be used as a home renovation loan. You may find that a construction loan is a suitable option as it enables you to draw funds as your renovation project progresses. You can compare construction home loans online or speak to a mortgage broker about taking out such a loan.
- Look into government grants: Check whether there are any government grants offered when you need the funds and whether you qualify. Initiatives like the HomeBuilder Grant were offered by the Federal Government for a limited period until April 2021. They could help fund your renovations either in full or just partially.
How do I refinance my home loan?
Refinancing your home loan can involve a bit of paperwork but if you are moving on to a lower rate, it can save you thousands of dollars in the long-run. The first step is finding another loan on the market that you think will save you money over time or offer features that your current loan does not have. Once you have selected a couple of loans you are interested in, compare them with your current loan to see if you will save money in the long term on interest rates and fees. Remember to factor in any break fees and set up fees when assessing the cost of switching.
Once you have decided on a new loan it is simply a matter of contacting your existing and future lender to get the new loan set up. Beware that some lenders will revert your loan back to a 25 or 30 year term when you refinance which may mean initial lower repayments but may cost you more in the long run.
What are the different types of home loan interest rates?
A home loan interest rate is used to calculate how much you’ll pay the lender, usually annually, above the amount you borrow. It’s what the lenders charge you for them lending you money and will impact the total amount you’ll pay over the life of your home loan.
Having understood what are home loan rates in general, here are the two types you usually have with a home loan:
Fixed rates
These interest rates remain constant for a specific period and are a good option if you’re a first-time buyer or if you’re looking for a fixed monthly repayment. One possible downside of a fixed rate is that it may be higher than a variable rate. Also, you don’t benefit from any lowering of interest rates in the market. On the flip side, if rates go up, your rate won’t change, possibly saving you money.
Variable rates
With variable interest rates, the lender can change them at any time. This change can be based on economic conditions or other reasons. Changes in interest rates could be beneficial if your monthly repayment decreases but can be a problem if it increases. Variable interest rates offer several other benefits often not available with fixed rate home loans like redraw and offset facilities and free extra repayments.
Does the Home Loan Rate Promise apply to discounted interest rate offers, such as honeymoon rates?
No. Temporary discounts to home loan interest rates will expire after a limited time, so they aren’t valid for comparing home loans as part of the Home Loan Rate Promise.
However, if your home loan has been discounted from the lender’s standard rate on a permanent basis, you can check if we can find an even lower rate that could apply to you.
When does Commonwealth Bank charge an early exit fee?
When you take out a fixed interest home loan with the Commonwealth Bank, you’re able to lock the interest for a particular period. If the rates change during this period, your repayments remain unchanged. If you break the loan during the fixed interest period, you’ll have to pay the Commonwealth Bank home loan early exit fee and an administrative fee.
The Early Repayment Adjustment (ERA) and Administrative fees are applicable in the following instances:
- If you switch your loan from fixed interest to variable rate
- When you apply for a top-up home loan
- If you repay over and above the annual threshold limit, which is $10,000 per year during the fixed interest period
- When you prepay the entire outstanding loan balance before the end of the fixed interest duration.
The fee calculation depends on the interest rates, the amount you’ve repaid and the loan size. You can contact the lender to understand more about what you may have to pay.
What is an interest-only loan? How do I work out interest-only loan repayments?
An ‘interest-only’ loan is a loan where the borrower is only required to pay back the interest on the loan. Typically, banks will only let lenders do this for a fixed period of time – often five years – however some lenders will be happy to extend this.
Interest-only loans are popular with investors who aren’t keen on putting a lot of capital into their investment property. It is also a handy feature for people who need to reduce their mortgage repayments for a short period of time while they are travelling overseas, or taking time off to look after a new family member, for example.
While moving on to interest-only will make your monthly repayments cheaper, ultimately, you will end up paying your bank thousands of dollars extra in interest to make up for the time where you weren’t paying off the principal.
How do you determine which home loan rates/products I’m shown?
When you check your home loan rate, you’ll supply some basic information about your current loan, including the amount owing on your mortgage and your current interest rate.
We’ll compare this information to the home loan options in the RateCity database and show you which home loan products you may be eligible to apply for.
What is the Home Loan Rate Promise?
The Home Loan Rate Promise is RateCity putting its money where its mouth is. We believe that too many Australians are paying too much for their home loans. We’re so confident we can help Aussies save money, if we can’t beat your current rate, we’ll give you a $100 gift card.*
There are two reasons it pays to check your rate with the Home Loan Rate Promise:
- You can find out how much you could save on your home loan by switching to a loan with a lower interest rate
- If we can’t beat your current rate, you can claim a $100 gift card with our Home Loan Rate Promise*
What is an ongoing fee?
Ongoing fees are any regular payments charged by your lender in addition to the interest they apply including annual fees, monthly account keeping fees and offset fees. The average annual fee is close to $200 however there are almost 2,000 home loan products that don’t charge an annual fee at all. There’s plenty of extra costs when you’re buying a home, such as conveyancing, stamp duty, moving costs, so the more fees you can avoid on your home loan, the better. While $200 might not seem like much in the grand scheme of things, it adds up to $6,000 over the life of a 30 year loan – money which would be much better off either reinvested into your home loan or in your back pocket for the next rainy day.
Example: Anna is tossing up between two different mortgage products. Both have the same variable interest rate, but one has a monthly account keeping fee of $20. By picking the loan with no fees, and investing an extra $20 a month into her loan, Josie will end up shaving 6 months off her 30 year loan and saving over $9,000* in interest repayments.
How does ANZ calculate early repayment costs?
If you have a fixed interest home loan, you’ll pay ANZ home loan early exit fees for partial or full repayment of the loan amount before the end of the fixed interest rate duration. These fees are also payable if you switch to another variable or fixed-rate loan.
The ANZ mortgage early exit fees can vary and you can get an estimate from the lender before you decide to prepay the loan. However, the exact early repayment cost can be determined when you prepay the loan.
The early exit fees are calculated after considering factors like the prepayment amount, the period left before the fixed-rate duration ends, and the change in the market rates since the beginning of the fixed-rate period. The early exit fees may not be charged if you’re paying off a smaller amount. You can check with ANZ to see how much you’ll have to pay.
What is the average length of a home loan?
Most Aussie lenders offer home loans with a 30-year term, meaning that you should pay back the full loan amount and the interest you owe on the amount in 30 years.
However, home loans can also have a shorter or longer term. They may be as low as ten years or up to 45 years, depending on the product and lender.
It’s worth remembering that a longer loan term usually means you’ll end up paying a lot more interest in total, but your scheduled repayments may be more manageable. In contrast, you could opt for a shorter loan term if you are comfortable making large repayments in exchange for paying less interest over the term of the loan.
What is the best interest rate for a mortgage?
The fastest way to find out what the lowest interest rates on the market are is to use a comparison website.
While a low interest rate is highly preferable, it is not the only factor that will determine whether a particular loan is right for you.
Loans with low interest rates can often include hidden catches, such as high fees or a period of low rates which jumps up after the introductory period has ended.
To work out the best value for money, have a look at a loan’s comparison rate and read the fine print to get across all the fees and charges that you could be theoretically charged over the life of the loan.
When do mortgage payments start after settlement?
Generally speaking, your first mortgage payment falls due one month after the settlement date. However, this may vary based on your mortgage terms. You can check the exact date by contacting your lender.
Usually your settlement agent will meet the seller’s representatives to exchange documents at an agreed place and time. The balance purchase price is paid to the seller. The lender will register a mortgage against your title and give you the funds to purchase the new home.
Once the settlement process is complete, the lender allows you to draw down the loan. The loan amount is debited from your loan account. As soon as the settlement paperwork is sorted, you can collect the keys to your new home and work your way through the moving-in checklist.
Why does Westpac charge an early termination fee for home loans?
The Westpac home loan early termination fee or break cost is applicable if you have a fixed rate home loan and repay part of or the whole outstanding amount before the fixed period ends. If you’re switching between products before the fixed period ends, you’ll pay a switching break cost and an administrative fee.
The Westpac home loan early termination fee may not apply if you repay an amount below the prepayment threshold. The prepayment threshold is the amount Westpac allows you to repay during the fixed period outside your regular repayments.
Westpac charges this fee because when you take out a home loan, the bank borrows the funds with wholesale rates available to banks and lenders. Westpac will then work out your interest rate based on you making regular repayments for a fixed period. If you repay before this period ends, the lender may incur a loss if there is any change in the wholesale rate of interest.
What are the features of home loans for expats from Westpac?
If you’re an Australian citizen living and working abroad, you can borrow to buy a property in Australia. With a Westpac non-resident home loan, you can borrow up to 80 per cent of the property value to purchase a property whilst living overseas. The minimum loan amount for these loans is $25,000, with a maximum loan term of 30 years.
The interest rates and other fees for Westpac non-resident home loans are the same as regular home loans offered to borrowers living in Australia. You’ll have to submit proof of income, six-month bank statements, an employment letter, and your last two payslips. You may also be required to submit a copy of your passport and visa that shows you’re allowed to live and work abroad.