Since launching onto the home loan scene in March 2022, OneTwo Home Loans is already shaking up the home lending space. The new lender offers one home loan, which it claims is the first of its kind - the Rate Reducing Home Loan.

Yep, it’s exactly what it sounds like. This innovative new home loan product offers to reduce your interest rate automatically as you pay off your home loan.

According to OneTwo’s website, you could see up to 0.15% sliced off your rate as you pay off your loan.

Currently, OneTwo’s Rate Reducing Home Loan is only available for owner-occupiers refinancing in metro and inner-regional areas of Queensland, NSW, Victoria, and SA - WA is reportedly coming soon. 

Speaking to, CEO Derek Sheerin also said an investor home loan is coming soon.

With no fees, up to $2,500 in bonus payments, and a $5,000 cashback currently on offer - is this a new online lender to watch?

Below is an example of OneTwo's variable-rate home loan product offering for owner occupiers.

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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
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.

It all began in sync with the pandemic: Good timing?

Mr Sheerin told about the company’s beginnings, how its product works and more.

OneTwo first came about in early 2020, right as we all went into the first COVID lockdown.

“After just a few short weeks together in the office we were all at home working and home-schooling, while building our brand new kind of home loan and creating a video application experience,” Mr Sheerin said.

“Our team was growing rapidly in lockdowns and all our communication was through video calls, which I think helped us better understand customers’ needs when creating a video loan application experience.”

The product was initially piloted at the end of 2021 initially to family and friends, and OneTwo’s first official campaign launched in March 2022 making them a relatively new player in the field.

“We’ve had a fantastic customer response to our product and we’re continuing to grow our geographic reach,” Mr Sheerin said.

"Brand new kind of home loan": The Rate Reducing Home Loan

If you’re wondering how the Rate Reducing Home Loan works, we’ve got you covered. Let’s discuss exactly how it works.

For every 5% you pay down of your home loan, OneTwo drops your interest rate 0.03% to a maximum of 0.15%. If you make any extra repayments in the first six months, you could get a bonus $2,500 back in your bank.

“While the rate is variable, the rate discounts apply for the life of the loan,” Mr Sheerin said.

“We’ll match any additional loan payments customers make in the first six months, up to $2,500 in total - paid out within 90 days of customers reaching their six months milestone.

“We play fair - we don’t charge any ongoing account keeping fees, application or exit fees.”

Limited time $5,000 cashback offer

Mr Sheerin also let us know that there’s currently a $5,000 cashback offer for people who refinance to OneTwo with a minimum loan amount of $500,000.

“If you apply to refinance your existing home loan from another financial institution to OneTwo between now and 30 June 2022 and settle on or before 15 November 2022, you will receive $5,000 cashback paid out within 60 days of settlement. Terms and conditions apply,” he said. 

"A digital experience that’s easy as OneTwo"

OneTwo describes its home loan application as “a conversation, not an application”.

“We’ve built our own technology platform from scratch, so we’ve been able to reinvent traditional processes and reduce business costs,” Mr Sheerin said.

“The business savings are then passed onto customers by way of a competitive rate and benefits.”

Mr Sheerin said OneTwo designed its product to put customers in control of their home loan rates and benefits.

“Customers are rewarded with rate discounts as they pay down their home loan - either on time, or ahead of time,” he said. 

“We’ve flipped the traditional balance of power between a lender and the customer on its head. Often with lenders, the best rate you ever get is when you first sign on, then over time your rate can creep up.”

Mr Sheerin said OneTwo took a completely different approach to most other lenders.

“The longer you’re with us, the greater the benefits. We want to help our customers to pay down their loan sooner and save cash along the way,” he said.

“[We offer] a home loan designed to help you save real money at a time when interest rates are going up, [with] home loan specialists who care first and foremost about your needs.

“[It’s] a digital experience that’s as easy as OneTwo.”

How to apply for a OneTwo home loan

Before you head to the website and start the application process, you’ll need to be able to answer ‘yes’ to these questions:

  • You currently live in a property (house, townhouse or unit) and you want to refinance. You don’t live in an apartment; it isn’t located in a multi-storey building, it’s not off-the-plan and it’s not under construction

  • You’re looking for an owner-occupier, principal and interest (P&I), variable rate home loan

  • You’re located in metro or inner regional QLD, NSW, VIC or SA (WA coming soon).

  • You have at least 20% equity in your property

  • Your existing loan balance is $2 million or less

  • For single borrowers: You’re a full time, part time or fixed term contract employee receiving a regular income via PAYG. You’re not a sole trader, director, partner, trustee or casual employee

  • For co-borrowers: The highest income earner is a full time, part time or fixed term contract employee that is not a sole trader, director, partner, trustee or casual employee

  • You’re an Australian citizen or permanent resident

If you can answer these questions with a ‘yes’, you may be eligible to refinance with OneTwo.

Image by R ARCHITECTURE on Unsplash

Article first published by Rachel Horan in May 2022, last updated September 2022.

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