Savings .com.au

Interest rate vs comparison rate

A loan’s comparison rate can help provide a better indication of the cost of a loan by taking both the interest rate and fees into account.

That’s why the comparison rate is usually higher than the advertised interest rate.

By law, each lender is required to display the comparison rate of a home loan next to the advertised interest rate.

How is the comparison rate calculated?

Not all home loans are the same, which is why the comparison rate isn’t always a perfect way of comparing home loans. A home loan comparison rate is uniformly calculated based on an assumed loan amount of $150,000 with a loan term of 25 years, and then factors in the fees the loan has stretched over that time.

Because of these assumptions, the comparison rate should be taken with a pinch of salt. Data from 2019 found the median value of a dwelling in Australia was $516,713 - much more than $150,000 - and home loans can often last for 30 years plus.

Despite its flaws, however, the comparison rate can make it a lot easier for you to compare home loans on costs.

Our home loan comparison rate calculator can help you see how comparison rates are calculated to reflect a loan’s costs.

Comparison rate calculator

To use our comparison rate calculator, enter the following information:

  • The loan amount
  • The loan term
  • The fixed interest rate and the fixed term (if applicable)
  • The ongoing interest rate (not introductory or fixed)
  • Monthly fees
  • Upfront fees
  • A discharge fee (if applicable)

By entering all of this, Savings.com.au’s home loan comparison rate calculator can estimate a loan’s comparison rate, repayments, total fees payable, total interest payable, and the total cost.


Looking for a home loan?

Buying a home or looking to refinance? The table below features home loans
with some of the lowest interest rates on the market for owner occupiers.

Lender

VariableMore details
Online ExclusiveUp To $4K Cashback Includes NOV RBA Rate Increase
  • Immediate cashback upon settlement
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000
Online ExclusiveUp To $4K Cashback Includes NOV RBA Rate Increase

loans.com.au – Variable Basic Cashback Home Loan (Principal and Interest) (LVR < 70%)

  • Immediate cashback upon settlement
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000
VariableMore details
Refinance OnlyApply In Minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Refinance OnlyApply In Minutes

Unloan – Variable Rate Home Loan – Refinance Only

  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
VariableMore details
Unlimited Redraws
  • No annual fees – None!
  • Get fast pre-approval
  • Unlimited additional repayments free of charge
  • Redraw freely – Access your additional payments when you need them
  • Home loan specialists available today
Unlimited Redraws

ubank – Neat Variable Home Loan (Principal and Interest) (LVR < 60%)

  • No annual fees – None!
  • Get fast pre-approval
  • Unlimited additional repayments free of charge
  • Redraw freely – Access your additional payments when you need them
  • Home loan specialists available today
VariableMore details
  • Up is 100% owned by Bendigo Bank.
  • Up to 50 offset accounts
  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)

Up – Up Home Variable (Principal & Interest) (LVR ≤ 90)

  • Up is 100% owned by Bendigo Bank.
  • Up to 50 offset accounts
  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)
VariableMore details

Reduce Home Loans – Rate Cutter Home Loan (LVR < 60%)

    VariableMore details
    4.6 Star Customer RatingsIncludes Nov RBA Rate Increase
    4.6 Star Customer RatingsIncludes Nov RBA Rate Increase

    loans.com.au – Variable Home Loan (LVR < 90%)

      VariableMore details
      • $0 application fee
      • Fast turnaround times
      • Estimate your borrowing power in as little as 1 minute

      Macquarie Bank – Offset Package Home Loan (Principal and Interest) (LVR 60%-70%)

      • $0 application fee
      • Fast turnaround times
      • Estimate your borrowing power in as little as 1 minute
      VariableMore details

      ubank – Neat Variable Home Loan (Principal and Interest) (LVR 70%-80%)

        VariableMore details
        • $0 application fee
        • Fast turnaround times
        • Estimate your borrowing power in as little as 1 minute

        Macquarie Bank – Basic Home Loan (Principal and Interest) (LVR 70%-80%)

        • $0 application fee
        • Fast turnaround times
        • Estimate your borrowing power in as little as 1 minute
        FixedMore details

        Reduce Home Loans – Home Owners Dream Fixed Cashback 1 Year (LVR < 80%)

          FixedMore details

          Westpac – Premier Package Fixed Options Home Loan (Principal and Interest) 1 Year (LVR < 70%)

            FixedMore details

            Commonwealth Bank – Fixed Rate Home Loan (Principal and Interest) 3 Years

              VariableMore details

              NAB – Base Variable Home Loan (Principal and Interest) (New Customer)

                FixedMore details

                ANZ – Fixed Rate Home Loan (Principal and Interest) 5 Years (LVR < 80%)

                  FixedMore details
                  • Up is 100% owned by Bendigo Bank.
                  • Up to 50 offset accounts
                  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)

                  Up – Up Home Fixed 4 Years (Principal & Interest) (LVR ≤ 90)

                  • Up is 100% owned by Bendigo Bank.
                  • Up to 50 offset accounts
                  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)
                  VariableMore details

                  Heritage Bank – Discount Variable Home Loan ($150k+) (LVR < 70%)

                    VariableMore details

                    P&N Bank – & Basic Home Loan (LVR < 60%)

                      FixedMore details

                      Newcastle Permanent – Premium Plus Package Fixed Rate Home Loan Special (Principal and Interest) 2 Years

                        VariableMore details

                        MOVE Bank – Straightforward Plus Home Loan (LVR < 80%) (New Customer)

                          FixedMore details

                          HSBC – Package Fixed Rate Home Loan (Principal and Interest) 4 Years (LVR < 80%)

                            Important Information and Comparison Rate Warning

                            Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of December 6, 2023. View disclaimer.