Variable Home Loan Rates Comparison

A variable rate home loan is one in which the interest rate is subject to change throughout the life of the loan. Unlike a fixed interest rate that is set for a period of time, a variable interest rate can fluctuate based on a range of economic factors, including changes to the official cash rate set by the Reserve Bank of Australia (RBA). When your variable home loan's interest rate rises or falls, so will your mortgage repayments.

Should you choose a variable rate home loan?

Whether a variable rate home loan is the right choice for you will depend on your individual financial situation and the kind of home buyer you are.

If you are a first home buyer 

Variable rate home loans may offer more flexibility, but the added security offered by fixed rate home loans may appeal to some borrowers buying property for the first time. A set interest rate can provide a level of financial certainty and could help simplify your budget, allowing you to focus on building up equity in your home.

If you are an investor

If interest rates are tipped to fall, repayments on a variable rate investment loan could become more affordable. If you plan to sell the property or refinance in the near future, a variable rate loan might be more attractive if interest rates are lower than current fixed rate options. Plus, access to features on your investment loan may help to further minimise interest repayments.

If you are refinancing 

You'll want to take stock of the current rate environment if you're considering refinancing. This may help you to better determine whether a fixed or variable rate will suit your budget for the foreseeable future. But if you originally signed up to a no-frills, basic mortgage, you could also consider switching to a variable rate home loan that offers helpful features, like an offset account.

Finding the lowest variable mortgage interest rates available on our site can be made relatively simple by using a comparison table, like the one on this page. Comparison tables can help you to compare apples with apples. You'll be able to filter your results and view them side by side to see how they shape up against each other. 

1. Start your search by entering some basic details about the kind of mortgage you’re seeking.
2. You can use additional filters to further narrow down your list of potential home loan options.
3. The more information you can provide, the closer the loans may match your requirements. 

A home loan is typically a 20-30 year-long commitment, so it's essential to compare your options carefully. Just because a loan comes with a low interest rate, does not mean it shakes out to be the cheapest overall. In fact, if you're aiming to keep your mortgage costs low, be sure to compare the fees charged by the lender - including upfront, ongoing and exit fees. A low rate home loan with high annual fees may cost you more over a 30-year loan term than a mortgage with a higher rate, but zero ongoing fees.

Using a mortgage repayment calculator can help you determine the approximate cost of mortgage repayments and understand how different interest rates, loan terms and more can affect the overall cost of your home loan.

If you're finding it hard to decide between a fixed rate home loan and a variable rate home loan, you could consider a split rate home loan and, as the name suggests, divide the interest rate on your mortgage between a fixed rate and a variable rate.

It is generally up to you to decide what percentrage of your home loan will have a fixed rate and a variable rate. You may decide on a clean 50/50 split, or you might decide on a 25/75 split with a smaller portion on a fixed interest rate and the remaining balance on a variable rate.

On a split loan, you may be able to benefit from access to flexible features, such as an offset account or a redraw facility, and the ability to make additional repayments on the variable rate portion, while also benefiting from more consistent repayments from the portion with the fixed interest rate. Just keep in mind that if variable rates significantly decrease, the fixed portion of your loan won't benefit from those reductions, potentially leading to missed savings.

At RateCity, there are several options available to help you find the ideal variable rate home loan to suit your financial situation when buying your new home. You can look at the current RBA cash rate and compare it to the other interest rates, and you can also use our calculators to estimate how much you could borrow, or the affordability of different loans.

You can also use comparison tables, like the one on this page, to compare the interest rates, fees and repayments for a wide variety of variable rate home loans that suit your needs and goals. By viewing loan options side-by-side, you're able to easily compare your options.

To help create a shortlist of loan options, simply go to the comparison table, click on ‘sort by’, then select Real Time Ratings™. You will then be shown a range of home loan options based on your loan preferences, and sorted by the highest rated products. 

Alternatively, if you're looking for more help finding a variable rate loan that best suits your financial situation, it may be worth reaching out to a mortgage broker for personalised help. 

1. Start with a comparison table: Comparison tables are the ideal place to start a search for a low variable home loan rate. This tool shows a list of available loans and lenders, and allows you to fill in a few blanks to better tailor the home loan search experience for your needs.
2. Enter your loan amount:While a comparison table will start from a default loan amount, you can change the loan size to match your actual loan requirements, which will change your repayment amount with it.
3. Pick your deposit amount:Enter your deposit amount, such as 10%, 15% or 20%. Some lenders will prefer a minimum 10-20% deposit. There may be some lenders willing to loan to customers with deposits as little as 5%. The bigger your deposit, the better your loan and lender choice may be - generally speaking./
4. Decide on your loan term:Home loan terms are typically 20-30 years. The longer your term, the lower your monthly repayments but greater your interest charges over time, and vice versa for shorter terms.
5. Change the sorting order:Once you've tailored the list to match your needs, it's time to sort it. If you're trying to find the lowest variable home loan rate, consider changing the sort order to work using the Interest Rate or Comparison Rate. Keep in mind that the lowest rate may not end up being the best loan, as other features could help improve a loan's value beyond the interest rate alone.