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LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
70%
Featured Online ExclusiveUp To $4K Cashback
  • Immediate cashback upon settlement
  • $2,000 for loans up to $700,000
  • $4,000 for loans over $700,000
5.99% p.a.
5.90% p.a.
$2,396
Principal & Interest
Variable
$0
$0
80%
Featured 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.
6.09% p.a.
6.11% p.a.
$2,421
Principal & Interest
Variable
$0
$250
60%
Featured 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
6.30% p.a.
6.58% p.a.
$2,476
Principal & Interest
Variable
$0
$791
95%
Featured Unlimited RedrawsApply In Minutes
  • Low Deposit (<95% LVR) with No LMI required
  • Unlimited Redraw and additional repayments
  • No Application or ongoing fees
5.94% p.a.
5.95% p.a.
$2,383
Principal & Interest
Variable
$0
$0
90%
No hidden feesFree redraw facility
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
90%
4.6 Star Customer Ratings
6.14% p.a.
6.16% p.a.
$2,434
Principal & Interest
Variable
$0
$250
80%
  • Home loan specialists available today
6.59% p.a.
7.68% p.a.
$2,552
Principal & Interest
Fixed
$395
$0
70%
6.69% p.a.
7.06% p.a.
$2,578
Principal & Interest
Variable
$395
$200
80%
6.84% p.a.
6.88% p.a.
$2,618
Principal & Interest
Variable
$0
$0
95%
6.84% p.a.
7.06% p.a.
$2,618
Principal & Interest
Fixed
$0
$160
80%
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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 . View disclaimer.

Home loan lender Reviews

WLTH Home Loans Athena Home Loans Commonwealth Bank loans.com.au Macquarie Tiimely homeloans.com.au New Castle Permanent UBank Unloan Home Loans Great Southern Bank Home Loans Sucasa Home Loans
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February Home Loan Rates & Deals

The Reserve Bank of Australia looks poised to hold the cash rate steady this month, with cuts likely to begin later this year, depending on the data flow. In the meantime, there are a multitude of hot mortgage deals available in February. Here are some of the top home loan deals currently on the market for owner-occupiers looking to buy or refinance:

  • Tiimely Home (formerly tic:toc): Live-in Variable Rate Home Loan (LVR<90%) 5.94% p.a (comparison rate 5.95% p.a.)
  • Unloan: Variable Rate Home Loan (refinance only)(LVR<80%) 5.99% p.a. (comparison rate 5.90% p.a.)
  • Heritage Bank: Discount variable home loan (>$150,000, LVR<70%) 5.99% p.a. (comparison rate* 6.01% p.a.)
  • loans.com.au: Variable home loan (LVR<90%) 6.04% p.a (6.06% comparison rate p.a.)
  • For more information on how we’ve selected these products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of 5 February, 2024. View disclaimer

How can you save money on a home loan?

Interest is the biggest source of a home loan's costs, with the typical borrower paying hundreds of thousands in interest over the life of a loan. So naturally, a lower interest rate can save you a lot of money on a home loan.

If you have an existing home loan, you can save by refinancing to a home loan with a lower interest rate.

Other ways to save include making extra repayments or utilising an offset account.

When comparing home loans, are low interest rates important?

Lower interest rates are key to generating big savings on your home loan. Even a slightly lower rate could save you thousands. Allow us to demonstrate.

Let’s compare two 30-year home loans, one at 5.00% p.a. and another at 5.50% p.a. Neither home loan has an introductory rate or upfront or ongoing fees.

The table below shows the difference in monthly repayments for various loan amounts, plus the total interest cost savings over the life of the loan. 

Loan amount 5.00% 5.50% Monthly savings at 5.00% Total savings at 5.00%
$300,000 $1,610.46 $1,703.37 $92.91 $33,444.74
$400,000 $2,147.29 $2,271.16 $123.87 $44,593.33
$500,000 $2,684.11 $2,838.95 $154.84 $55,740.99
$700,000 $3,757.75 $3,974.52 $216.77 $78,037.60

Calculations made via Savings.com.au's Home Loan Comparison Calculator.

How to find a good home loan interest rate

If you are willing to refinance or are just entering the market, then websites such as this one would be a good place to start your search. 

Here are a few things to consider when looking for a good home loan interest rate: 

  • Does the loan have an introductory rate? Some low rate loans have introductory rates, which charge a lower rate for short time (the honeymoon period) before reverting to a higher rate.     
  • Is it a fixed or variable rate? Think carefully about whether you want a fixed or variable interest rate because there are important pros and cons to both that should be considered.   
  • What are the fees? While not as significant as the interest rate, home loan fees can easily rack up in the thousands over time. Tip: A loan with a relatively high comparison rate is likely to have high fees.   
  • Is it interest-only? Interest-only loans allow you to make just interest payments on the loan for an agreed period as opposed to repaying the debt (the 'principal'). The repayments may be temporarily lower, but it'll mean your repayments are substantially higher when the interest-only period is up.  

What’s happening with interest rates?

Like many other developed countries, interest rates in Australia are much higher now than they were during the pandemic, when many lenders were offering home loans for under 2.00% p.a.   

Interest rates on home loans have generally followed the trajectory of the cash rate, which is set by the Reserve Bank of Australia (RBA). Forecasts on the future direction of the cash rate are mixed, with the RBA's decisions largely dependent on economic factors such as inflation and unemployment. 

Rate increases are not good news for borrowers, but good news for saver - vice versa for rate decreases.

Lenders wasted no time in passing on the RBA's rate rises to mortgage rates, but some are offering much lower rates than others so there are still savings to be had.

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Frequently Asked Questions

A home loan is a sum of money that's borrowed from a lender to finance the purchase of a home or investment property. The borrower repays this debt with interest in regular instalments over an agreed term, typically 25-30 years. To provide the lender with security, the property is held by the lender as collateral until the loan is paid off - an arrangement known as a mortgage.

  1. Make more frequent weekly or fortnightly repayments
  2. Make extra repayments
  3. Consider refinancing your home loan to a lower interest rate
  4. Consider an offset account
  5. Pay off the principal

Most home loan terms are between 25-30 years but a handful of lenders in Australia offer loan terms of up to 40 years.

A credit rating is a numerical score that represents your trustworthiness as a borrower. The higher the score, the more trustworthy a borrower looks to a lender. Your credit score can determine how much a lender is willing to lend you for a home, what interest rate to charge you, and whether you can afford to meet your repayments.

Equity in a home is the difference between the value of your home and how much you owe on the mortgage. For example, if your property is worth $500,000 and you still owe $300,000, your equity is $200,000. Our equity calculator can help you work out how much equity you have in your property.

The home loan application process can be quite lengthy but isn't too complicated. It will generally involve the following steps:

  1. Save for a deposit
  2. Find your perfect home or getting pre-approval first
  3. Gather your required documents
  4. Compare home loan providers
  5. A preliminary assessment by the lender
  6. Submit your application to the lender
  7. The lender completes a property valuation
  8. The lender approves or rejects the loan
  9. The lender sends you an offer
  10. The loan is settled and the funds are advanced to you.

Read our home buying checklist for a complete breakdown of everything you need to know.

Fixing your home loan can be good for those who need cash flow certainty, which is why many investors and first-time buyers choose them. If interest rates are very low, locking in that low rate before they rise can be a good idea. However, that can also backfire if interest rates drop even further, as those changes only apply to variable home loans, not fixed home loans. It can also be harder to repay a fixed loan early as you will have to pay significant break costs for terminating the fixed-rate period.

If your current lender can't offer you what you need anymore, it may be time to refinance your home loan. Shop around and compare new home loans, calculate the costs of switching and consider the length of the new loan. Once you’ve found the ideal loan, apply through the lender and exit your old home loan.

A comparison rate helps you work out the true cost of a loan by combing the interest rate plus a number of fees and charges you can expect to pay over the life of the loan into a single percentage figure.

How much you can borrow for a home loan will depend on many factors such as your income, your savings history, your monthly living expenses, and any outstanding debt you may have. However, it is generally recommended that you borrow no more than 80% of the value of the property, meaning you must have at least a 20% deposit saved. Use our calculator to work out how much you can borrow.

A redraw facility is a home loan feature that allows borrowers to withdraw extra repayments they have made on their home loan. Redraw facilities are useful if you want to reduce your loan amount as quickly as possible, while being able to access those funds at some point in the future should a financial emergency or other situation arises where you may need that money (like a renovation).

An offset account is a transaction account linked to your home loan where the money stored in the account is ‘offset’ against your home loan debt when interest is calculated, reducing the amount of interest charged on your loan.

To be eligible for a home loan, you must have:

  • A deposit (at least 5%)
  • A good credit history
  • A stable income
  • A regular savings history
  • No significant debts
  • At least two forms of identification, one of which must be photo ID
  • Bank statements and payslips
  • Council rates for any other properties you own

For other relevant documents, see the Home Loan's 101

The amount needed for a house deposit varies, but you'll usually need at least 5% of the property's value, which is an LVR (loan-to-value ratio) of 95%. To avoid paying Lenders Mortgage Insurance (LMI) most lenders will require you to provide a deposit of 20% of the property's value.

A mortgage default (missing a repayment by 90 days) won't bankrupt you but will require you to pay a late fee up to $200. This may seem relatively minor, but defaulting on your mortgage will also be recorded on your credit file, damaging your credit score.

The time it takes for a lender to approve your home loan can differ from lender to lender, but it generally takes anywhere between four to six weeks. You can speed up your home loan approval by ensuring you meet all the borrowing criteria, have all your paperwork ready and correctly fill out the application form, have a good savings and credit history, and get pre-approval.

Dominic Beattie

Dominic Beattie

Editor

Home loan interest rates have risen, but still savings to be had

Interest rates may be significantly higher than they were a few years ago, but you may be able to give yourself a rate cut by refinancing to a better home loan deal.

As you can see from our comparison table, some lenders are offering home loans at much lower rates than others. 

Dominic Beattie,Editor