Compare Fixed-rate Home Loans

What is a fixed home loan?

'Fixing' your home loan means locking in the interest rate, and therefore mortgage repayments, for a set period of time. This is distinct from variable-rate home loans, where the interest rate can change at any time (normally in line with movements to the RBA cash rate). Fixed terms in Australia are generally between one and five years, although some lenders offer longer terms - ANZ notably offer seven and ten year terms at the time of writing.

How to compare fixed rate home loans

The fixed rate, fees and break costs, extra features and the term length are some of the most important considerations when comparing fixed loans.

Fixed home loan rates

The interest rate you will pay is probably your biggest priority when choosing any loan. You should pay attention to the comparison rate as well as the interest rate, as this takes into account extra costs and fees. For fixed rates in particular, you should try to find out what the revert rate will be. This is the rate your loan will go back to once the fixed term expires.

Fees and break costs

It's important to take the extra fees and charges on fixed-rate loans into consideration. Of particular note is the break costs, which you'll need to pay if you exit the loan during the fixed-term. Break costs can be tens of thousands of dollars, so you'll want to avoid having to pay these.

Features

Although features like offset accounts are usually reserved for variable-rate loans, there may still be extra perks and benefits on fixed products. For example, some lenders offer a 'rate lock' on fixed products, which means your rate will not change between when you are approved for a loan and when the funds are actually transferred, even if the rate on new fixed-rate loans changes in that time. Also, some lenders do allow extra repayments up to a certain limit on fixed rate loans. You might even find one or two lenders that offer offset accounts on fixed-rate loans!

Fixed rate terms

Fixed rates in Australia are generally between one and five years, with terms longer than this generally pretty rare.

This is very different to other countries like the USA, where 30 year fixed-rate mortgages are common. The US has a much more developed securitisation market than Australia, with government-sponsored entities that buy fixed-rate mortgages and package them together to resell as mortgage backed securities. This means lenders can transfer the risk that comes from longer-term rates to institutions like 'Fannie Mae' and 'Freddie Mac'.

When comparing fixed rates, it's important to consider the length of the fixed term. Longer-term fixed rates are usually higher than those on shorter terms, given lenders price in the extra uncertainty of looking further into the future. The gap between shorter and longer term rates can vary depending on the economic outlook.

For example, in September 2024 according to the RBA the average fixed rate on terms three years or below was 5.9% p.a., only 50 bps below longer terms (6.4% p.a.). At the time, the cash rate was high but a cutting cycle was broadly expected, with economists expecting the terminal cash rate would be at or even below 3%.

By November 2025 however, after three cash rate cuts, the outlook shifted, and monetary policy isn't expected to be loosened any further in the forseeable future. Therefore, short term fixed rates dropped to an average of 5.1% p.a., but longer term rates only dropped slightly to 6.2% p.a., the gap more than doubling.

What is a good fixed rate in 2026?

Australians have traditionally opted for variable rates over fixed, perhaps due to the limited options to fix for longer than five years. However, the past few years suggests Aussies gravitate towards fixed rates when it looks like variable rates will start to increase, or can't go much lower (as we saw amid the pandemic). According to the ABS, the percentage of new home loans with fixed rates rose above 46% in September 2021, when the RBA cash rate remained at the all time low of 0.10%. Once the cash rate began to rise, the share of new home loans at fixed-rates started to plummet, dropping below 5% and staying there since September 2023. Now in 2026, with interest rates looking like they may go up again soon, some Australians may be gravitating towards fixed rates once again.

Why fix your home loan rate?

The major advantage of fixing your home loan is guaranteeing what your repayments will be. Knowing that your repayments won't change over the fixed term can make it easier to budget further into the future. It also means you'll be temporarily protected from any interest rate rises.

Why shouldn't you fix your home loan?

You shouldn't fix your home loan if you want the flexibility to make unlimited extra repayments, access a redraw facility, or avoid the potentially high "break costs" associated with refinancing or selling your property early. While fixing provides certainty, the primary downside is that you remain locked into your rate even if the RBA lowers the cash rate, causing you to miss out on the savings that variable-rate holders enjoy.

Meanwhile, variable-rate home loans are typically more flexible than fixed-rate mortgages given they're more likely to allow extra repayments and access to features such as offset accounts and redraw facilities. It's also often cheaper/easier to refinance a variable-rate home loan than a fixed-rate home loan, since fixed-rates tend to come with break costs for exiting the fixed-term contract early. So if you think you might sell your home or refinance the house in the near future, perhaps a fixed-rate isn't for you.

Fixed vs variable rates

The advertised rates on both fixed- and variable-rate home loans tend to fluctuate based on what the RBA cash rate is or is expected to be in the future. Fixed rates generally price-in expected future moves in the cash rate. For instance, if the RBA is expected to lower the cash rate in the near future, fixed rates may be lower than variable rates to attract customers. On the other hand, if the RBA is expected to lift rates soon, fixed rates are likely to be higher than variable rates.

Ray Jokhan

Ubank chief home lending officer

Top 5 myths & benefits of fixing your home loan

" 1. “Fixing means I’ll be stuck if rates fall.”  

Myth:  Many borrowers overestimate how quickly rates fall after a cycle of hikes. 
Benefit:  Fixing can protect your budget during the highest‑stress period - and you can reassess when your term ends.  

2. “Fixed loans are always more expensive.”  

Myth:  Rates move with market expectations, not emotions. 
Benefit:  In periods of sticky inflation (like now), fixed rates can actually become competitive and offer stability. 

3. “Only older borrowers fix - it’s not for younger buyers.”  

Myth:  Younger borrowers - especially Gen Z - increasingly prioritise certainty because groceries and utilities keep rising alongside home loan repayments. 
Benefit:  A fixed rate gives structure to tight budgets and helps with long‑term planning. 

4. “You lose all flexibility.”  

Myth:  Split loans (a combination of fixed and variable) allows you to enjoy the benefits of both.  
Benefit: Borrowers can choose split loans to get the best of both worlds: predictability and freedom. 

5. “Fixing is about timing the market.”  

Myth:  You’re not trying to guess the perfect peak - you’re protecting yourself from stress, shocks, and budget blowouts. 
Benefit: The real value of a fixed rate is peace of mind, not perfect forecasting."