Compare popular home loans

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1.89%

Fixed - 2 years

2.94%

Suncorp Bank

$1.3k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

3.57

/ 5
More details

2.59%

Fixed - 5 years

2.53%

UBank

$1.4k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

2.47

/ 5
More details

3.03%

Variable

2.70%

UBank

$758

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

1.92

/ 5
More details

2.29%

Fixed - 3 years

2.74%

UBank

$1.3k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

2.05

/ 5
More details

2.74%

Fixed - 5 years

2.83%

UBank

$1.4k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

2.12

/ 5
More details

2.89%

Variable

2.89%

UBank

$1.4k

Redraw facility
Offset Account
Borrow up to 80%
Extra Repayments
Interest Only
Owner Occupied

2.50

/ 5
More details

Learn more about home loans

Why should you compare home loans

There are many reasons to compare home loans, and almost all of them benefit you in a positive way:

  • Are you missing out on home loan features or discounts because you haven't switched lenders in years?
  • Do you want some of the best home loan interest rates on the market? 

With thousands of home loans available on the Australian market, it can be difficult to work out which home loan is best for you. With a home loan comparison, you can look at the interest rates, features and benefits of several different home loans side by side and get a better idea of the value they offer before making any decisions. 

Whether you're after better rates or mortgage repayments lower than the Australian average, there are plenty of reasons to compare home loans with RateCity. 

Start your home loan comparison now

How to compare home loans

Consider beginning your home loan comparison by asking yourself the following questions:

  • How much do you want to borrow? - The more you choose to borrow for your home loan, the higher the cost of repayments.
  • How much deposit can you afford? - Home loans with lower interest rates are more likely to require higher upfront security deposits. If your deposit is less than 20% of the property's value, you may be required to pay Lender’s Mortgage Insurance (LMI).
  • How long do you want your home loan term to be? - Many home loans have 30-year terms, though some can last for 25 years or less, or run for as long as 45 years. Generally, the longer your loan term, the less interest you’ll pay each month, but the more interest you’ll pay on the loan in total.
  • Are you buying as an owner-occupier or as an investor? - Investors are often charged higher home loan interest rates than owner-occupiers.
  • What features do you want in a mortgage? - The best home loan isn't always the one with the lower rate. Rather, the best home loan is the one you're happy with, and that may mean other features, such as allowing you to make extra repayments, supporting an offset account, or a redraw facility. 

Once you've worked out some of your preferences, you can start to narrow down your list of potential home loan options for your mortgage comparison.

Example: Finding a low rate investment loan

Roy is a first-time investor who wants the lowest current home loan interest rate on the market. He has a deposit of $100,000 and wants a loan of $500,000. By selecting a loan term of 30 years using RateCity’s compare home loans function, he discovers more than 1000 potential loans available  for comparison.

Roy previously asked his bank, one of the big four banks, about the cost of a home loan. During his home loan comparison, Roy discovers there are at least five lenders on RateCity that can shave up to $80 a month off what his bank offered, with interest rates below 4.2%. Over 30 years, that adds up to a significant saving of over $28,000.

Roy wants to know more about one of the loans on offer, due to its low rate and low fees. He clicks the ‘View Now’ button and is directed to the lender’s website, where he can find more information about their home loan offers, as well as the lender's contact details.

How to find the lowest home loan rates on RateCity

To see what current mortgage interest rates are available in Australia and find the lowest interest rates you're likely to be eligible for, start by following these steps:

  • Enter some basic home loan search details at RateCity, such as whether you’re an owner occupier or an investor; how much you plan to borrow compared to the property's total value, or; your preference between fixed and variable interest rates.
  • Use more search filters to further narrow down your list of home loans. The more details you can provide, the more precise your mortgage comparison search results can be.
  • Sort RateCity’s comparison table either by Advertised Rate (for interest rate only) or Comparison Rate (for the approximate cost of interest plus fees) to find the lowest available results for your home loan requirements.

Find the lowest home loan rates on RateCity

What's considered a good interest rate on a home loan?

An interest rate of 4% or lower is generally considered to be a good home loan interest rate when making a mortgage rate comparison, though it's important to remember that the mortgage with the lowest rate may not be the best home loan for your unique needs.

Some low-interest home loans are quite simple, offering fewer extra features and benefits. The lowest interest rates in Australia may not be available to every borrower, due to the specific financial requirements of different lenders. 

Australia's average home loan interest rate changes regularly, as mortgage offers are added to or removed from the market. Because every mortgage is different, you’ll need to decide what the best home loan is for your needs. 

Working out how much extra you may need to pay in interest for home loans with additional features can help you get a better idea of the value they may be able to offer your household.

What are the best home loan rates, and how do I get them?

A great home loan rate is what you'll be after regardless of whether you're a first-home buyer, purchasing something new, or investing, but the best home loan rates are constantly changing.

Instead of focusing on the best home loan rates, consider looking for the best rates as they apply to your needs. 

Everyone's needs are different, and so the best mortgage rates on RateCity might be great for someone with an excellent credit score, but unattainable for someone with a few marks here and there. This is called "borrowing power", and it can shift loan rates in positive and negative ways. 

To get a gauge on what your borrowing power is like, look into your credit score and find out whether the best rates are possible for you.

Get your credit rating checked

How to customise your home loan comparison results

When you make a  home loan comparison, you can enter your preferred mortgage features to help find an option that better suits your needs.

Firstly, think about if you want a variable rate loan or a fixed rate loan:

  • Variable rate home loans – Variable interest rates may increase or decrease during your mortgage term, often in line with changes to Australia's official cash rate, but sometimes independently, depending on your lender. If your lender passes on a rate cut, you could save money on your mortgage repayments, but if rates rise, you could find yourself paying more.
  • Fixed rate home loans  Home loan interest rates can sometimes be fixed for a limited time, often from one to five years. During this time, your mortgage repayments will stay the same, for simple and consistent budgeting. This can protect you from higher repayments if interest rates rise, but you could also miss out on savings if interest rates fall.
  • Split rate home loans - Some borrowers also choose to split their home loan interest rates between fixed and variable interest rates to lock in a bit of certainty in case of rate rises, while also making the most of low rates when they're available.

You can also choose between making principal and interest repayments or interest-only repayments on your home loan:

  • Principal and interest (P&I) repayments – These home loan payments let you gradually repay the money you've borrowed while also covering your interest charges. While P&I repayments tend to be more expensive from month to month than paying interest only, they let you make steady progress towards clearing your debt, and can help to minimise the total interest you’re charged over the loan term.
  • Interest-only (IO) repayments - Some lenders allow you to delay repaying your debt and simply pay the interest charges for a limited time (generally between one and five years). This can help make your repayments more affordable in the short term, though you may end up paying more total interest over the loan’s full term as your repayments won’t be reducing the principal amount owing.

Learn more about home loans with the RateCity guide

Select your home loan features

After you’ve chosen your preferred type of home loan, interest rate and repayments, you can compare mortgages with some popular home loan features, such as an offset account, a redraw facility, or extra repayments.

  • Offset account - An offset account allows you to reduce the interest you pay by using money in a separate, but linked account to offset what you owe. For example, if you owe $300,000 but have $50,000 in an offset account, you’ll be charged interest as if you only owed $250,000, shrinking your repayments slightly.
  • Extra repayments - Some lenders allow you to make extra mortgage repayments if you have a good month, receive a one-off windfall, or find youself able to afford higher regular repayments. This can help you clear your loan balance more quickly, and reduce the total interest you’re charged on your loan.
  • Redraw facility - A redraw facility lets you withdraw any extra home loan repayments you’ve made if you need that money back in your pocket, which can be useful for covering unexpected expenses without having to take on more debt with a credit card or personal loan.

Choose your fees

One of the benefits when you compare home loans with a financial comparison website like RateCity is that as well as looking at home loan interest rates, you can also compare fees. High fees on a home loan can negate the impact of a low interest rate, so they’re important to consider.

Some of the fees you’re likely to encounter during your mortgage comparison include:

  • Upfront fees – These are the fees the lender will charge when you start your loan. They sometimes include establishment fees, conveyancing fees, stamp duty and Lender’s Mortgage Insurance (LMI). Upfront fees vary significantly between lenders.
  • Ongoing fees – These are the monthly or yearly fees your lender may charge for the upkeep of your loan.
  • Redraw fees – For some loans that feature a redraw facility, making a redraw may require paying a fee.
  • Discharge fees – At the conclusion of your loan, your lender may charge a termination fee to cover the administration costs.

Example: Flexibility seals the deal

Louise already has a home loan, but it doesn’t offer many benefits. She instead wants to refinance onto a loan where she can offset interest and make extra repayments once a year when she gets her tax refund. However, she doesn’t want to pay a high interest rate or high fees for those benefits.

To compare home loans, Louise enters her preferences at RateCity and finds there are a dozen loans through a home loan comparison with no ongoing fees, but many features. Even better, many of those home loans have interest rates lower than 4%, when at the moment she has a 4.5% interest rate. By switching, she stands to save more than $1600 a year.

Current Home Loan New Home Loan
Interest Rate 4.5% 4.0%
Loan Amount Owing $500,000 $500,000
Remaining Loan Term 25 years 25 years
Monthly Repayment $2779 $2639
Total Interest Paid $333,749 $297,755
Total Loan Cost $833,749 $791,755
Above examples are hypothetical and for illustrative purposes only. Calculation source: MoneySmart

Other types of home loans to compare

RateCity also allows you to compare less common types of home loans, such as low doc loans.

A low documentation loan is for borrowers who do not have the documents that are typically required to apply for a mortgage, such as:

  • Regular payslips
  • Steady employment history
  • Clean credit history

As a result, lenders often treat these customers as higher default risks, and decline their applications for standard home loans.

If you are in this position, it may be helpful to compare the low doc options on the market, as the current home loan interest rates on offer can vary significantly.

Find low documentation home loans in Australia

How home loan calculators can help

Working out what type of loan you need is just one part of the job. You also should work out how much you can borrow, what you'll be charged, and then evaluate the best home loan rate for you using all available information.

Home loan calculators offer a way to work through questions like "what is my borrowing power" and "how much stamp duty will I be charged", as well as other questions you may have about mortgage rates.

If anything, home loan calculators can help you make a better home loan comparison by doing the math for you, and working out how much money you have to buy your home.

Even if you're beyond the home buying stage and are looking to refinance, a mortgage calculator could assist in home refinancing, giving you the chance to see home loan interest rates that have the potential to improve your position.

Check out RateCity's home loan calculators

Frequently asked questions

What is a fixed home loan?

A fixed rate home loan is a loan where the interest rate is set for a certain amount of time, usually between one and 15 years. The advantage of a fixed rate is that you know exactly how much your repayments will be for the duration of the fixed term. There are some disadvantages to fixing that you need to be aware of. Some products won’t let you make extra repayments, or offer tools such as an offset account to help you reduce your interest, while others will charge a significant break fee if you decide to terminate the loan before the fixed period finishes.

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. 

What happens to my home loan when interest rates rise?

If you are on a variable rate home loan, every so often your rate will be subject to increases and decreases. Rate changes are determined by your lender, not the Reserve Bank of Australia, however often when the RBA changes the cash rate, a number of banks will follow suit, at least to some extent. You can use RateCity cash rate to check how the latest interest rate change affected your mortgage interest rate.

When your rate rises, you will be required to pay your bank more each month in mortgage repayments. Similarly, if your interest rate is cut, then your monthly repayments will decrease. Your lender will notify you of what your new repayments will be, although you can do the calculations yourself, and compare other home loan rates using our mortgage calculator.

There is no way of conclusively predicting when interest rates will go up or down on home loans so if you prefer a more stable approach consider opting for a fixed rate loan.

How can I calculate interest on my home loan?

You can calculate the total interest you will pay over the life of your loan by using a mortgage calculator. The calculator will estimate your repayments based on the amount you want to borrow, the interest rate, the length of your loan, whether you are an owner-occupier or an investor and whether you plan to pay ‘principal and interest’ or ‘interest-only’.

If you are buying a new home, the calculator will also help you work out how much you’ll need to pay in stamp duty and other related costs.

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 is a variable home loan?

A variable rate home loan is one where the interest rate can and will change over the course of your loan. The rate is determined by your lender, not the Reserve Bank of Australia, so while the cash rate might go down, your bank may decide not to follow suit, although they do broadly follow market conditions. One of the upsides of variable rates is that they are typically more flexible than their fixed rate counterparts which means that a lot of these products will let you make extra repayments and offer features such as offset accounts.

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.

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.

What are the responsibilities of a mortgage broker?

Mortgage brokers act as the go-between for borrowers looking for a home loan and the lenders offering the loan. They offer personalised advice to help borrowers choose the right home loan for their needs.

In Australia, mortgage brokers are required by law to carry an Australian Credit License (ACL) if they offer credit assistance services. Which is the legal term for guidance regarding the different kinds of credit offered by lenders, including home loan mortgages. They may not need this license if they are working for an aggregator, for instance, as a franchisee. In both these situations, they need to comply with the regulations laid down by the Australian Securities and Investments Commission (ASIC).

These regulations, which are stipulated by Australian legislation, require mortgage brokers to comply with what are called “responsible lending” and “best interest” obligations. Responsible lending obligations mean brokers have to suggest “suitable” home loans. This means loans that you can easily qualify for,  actually meet your needs, and don’t prove unnecessarily challenging for you.

Starting 1 January 2021, mortgage brokers must comply with best interest obligations in addition to responsible lending obligations. These require mortgage brokers to act in the best interest of their customers and also requires them to prioritise their customers’ interests over their own. For instance, a mortgage broker may not recommend a lender who gives them a commission if that lender’s home loan offer does not benefit that particular customer.

What is a comparison rate?

The comparison rate is a more inclusive way of comparing home loans that factors in not only on the interest rate but also the majority of upfront and ongoing charges that add to the total cost of a home loan.

The rate is calculated using an industry-wide formula based on a $150,000 loan over a 25-year period and includes things like revert rates after an introductory or fixed rate period, application fees and monthly account keeping fees.

In Australia, all lenders are required by law to publish the comparison rate alongside their advertised rate so people can compare products easily.

What is the difference between fixed, variable and split rates?

Fixed rate

A fixed rate home loan is a loan where the interest rate is set for a certain amount of time, usually between one and 15 years. The advantage of a fixed rate is that you know exactly how much your repayments will be for the duration of the fixed term. There are some disadvantages to fixing that you need to be aware of. Some products won’t let you make extra repayments, or offer tools such as an offset account to help you reduce your interest, while others will charge a significant break fee if you decide to terminate the loan before the fixed period finishes.

Variable rate

A variable rate home loan is one where the interest rate can and will change over the course of your loan. The rate is determined by your lender, not the Reserve Bank of Australia, so while the cash rate might go down, your bank may decide not to follow suit, although they do broadly follow market conditions. One of the upsides of variable rates is that they are typically more flexible than their fixed rate counterparts which means that a lot of these products will let you make extra repayments and offer features such as offset accounts.

Split rates home loans

A split loan lets you fix a portion of your loan, and leave the remainder on a variable rate so you get a bet each way on fixed and variable rates. A split loan is a good option for someone who wants the peace of mind that regular repayments can provide but still wants to retain some of the additional features variable loans typically provide such as an offset account. Of course, with most things in life, split loans are still a trade-off. If the variable rate goes down, for example, the lower interest rates will only apply to the section that you didn’t fix.

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.

What is 'principal and interest'?

‘Principal and interest’ loans are the most common type of home loans on the market. The principal part of the loan is the initial sum lent to the customer and the interest is the money paid on top of this, at the agreed interest rate, until the end of the loan.

By reducing the principal amount, the total of interest charged will also become smaller until eventually the debt is paid off in full.

What are extra repayments?

Additional payments to your home loan above the minimum monthly instalments, which can help to reduce the loan’s term and remaining payable interest.

How common are low-deposit home loans?

Low-deposit home loans aren’t as common as they once were, because they’re regarded as relatively risky and the banking regulator (APRA) is trying to reduce risk from the mortgage market.

However, if you do your research, you’ll find there is still a fairly wide selection of banks, credit unions and non-bank lenders that offers low-deposit home loans.

How personalised is my rating?

Real Time Ratings produces instant scores for loan products and updates them based what you tell us about what you’re looking for in a loan. In that sense, we believe the ratings are as close as you get to personalised; the more you tell us, the more we customise to ratings to your needs. Some borrowers value flexibility, while others want the lowest cost loan. Your preferences will be reflected in the rating. 

We also take a shorter term, more realistic view of how long borrowers hold onto their loan, which gives you a better idea about the true borrowing costs. We take your loan details and calculate how much each of the relevent loans would cost you on average each month over the next five years. We assess the overall flexibility of each loan and give you an easy indication of which ones are likely to adjust to your needs over time. 

What is appreciation or depreciation of property?

The increase or decrease in the value of a property due to factors including inflation, demand and political stability.

Mortgage Calculator, Loan Amount

How much you intend to borrow. 

Savings over

Select a number of years to see how much money you can save with different home loans over time.

e.g. To see how much you could save in two years by switching mortgages,  set the slider to 2.

Remaining loan term

The length of time it will take to pay off your current home loan, based on the currently-entered mortgage balance, monthly repayment and interest rate.