Home Loan Comparison

July Home Loan Rates & Deals

After a second RBA cut for 2025, the home loan market continues to shift in favour of borrowers. For now, the cash rate is still at a restrictive level, but with further cuts later in the year looking likely mortgage holders have plenty of justification to be hopeful about even lower interest rates moving forward.

As of 2 July 2025, here were the home loans in the savings.com.au database to catch my eye:

Which lenders are offering the lowest home loan rates on Savings.com.au?

Home Loan Type	Lender & Product	Rate p.a.	Comp. Rate p.a.*	Notes
Lowest Variable-rate Home Loan	Police Bank - First Home Loan	5.34%	5.41%	LVR 80-98%
Lowest Fixed-rate Home Loan	Australian Mutual Bank - Three Year Fixed	4.99%	5.75%	3-year fixed, <80% LVR
Lowest Refinance Home Loan	Australian Mutual Bank - Three Year Fixed	4.99%	5.75%	3-year fixed, <80% LVR
Lowest Investor Home Loan	Police Bank - Three Year Fixed	4.99%	5.71%	3-year fixed, <60% LVR
Lowest Green Home Loan	Bank Australia – Clean Energy Home Loan, New Build	4.94%	5.95%	3-year fixed, new build, <90% LVR
Refinance Cashback Deal	Regional Australia Bank – Purchasing or refinancing loans	—	—	Up to $4,000 cashback on owner-occupier or investment loans >$200k

Until next month 🫡

Harry O'Sullivan - Finance Journalist

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 30 June, 2025 . View disclaimer

How to compare home loan features to save money

Here are some of the top things to consider when choosing a home loan:

Loan Purpose

When comparing home loans, it's important to know exactly what your loan purpose is, as home loan products can wildly differ depending on what you need the home loan for. Here are the most common home loan purposes:

• Buying a home to live in: Owner-occupied home loans

• Buying a home to rent out and sell for profit in future: Investment home loans

• Building a home: Construction home loans

• Changing an existing home loan: Refinancing home loans

• Buying an investment property for an SMSF fund: SMSF loans

Fees

Home loans can come with a variety of one-off and ongoing fees, such as establishment fees and annual fees. It can be hard to compare all these fees, but here's a quick tip - use the comparison rate as a guide.

A home loan with high fees will often have a comparison rate that's much higher than its advertised interest rate.

Offset or Redraw

Home loan features such as offset accounts and redraw facilities can be incredibly valuable for borrowers, enabling them to save big on interest by essentially storing their spare cash in the loan, or an account that's linked to the loan. These funds effectively reduce the balance of the loan that's charged interest while remaining accessible for the borrower to withdraw if needed.

However, the level of accessibility of these funds is one of the key differences between offset accounts and redraw facilities, with money typically easier to withdraw from an offset account than a redraw facility. Most home loans come with a redraw facility, while home loans with offset accounts tend to have higher interest rates.

LVR & Deposit Size

Loan to value ratio (LVR) reflects the size of a home loan in respect to the value of the property it's being used to purchase, and is a key number to keep in mind when comparing home loans. It's inherently linked to the size of your deposit - the bigger your deposit or equity in the value of a property, the smaller your LVR will be. For example, if you have 20% equity in your property, you have an 80% LVR. Try out our LVR calculator to discover your LVR.

Lenders often reserve the lowest interest rates for borrowers with LVRs of 60% or less, and typically charge lenders mortgage insurance on borrowers with LVRs over 80%.

Home Loan Approvals

While the cost of a home loan is likely your priority, it might be worth comparing things like the quality of customer service or approval times of different lenders. Some lenders make it much easier to apply for a home loan than others thanks to having a smoother online interface and speedy loan approval technology. You may also wish to compare lenders on their pre-approval requirements and conditions.

Regardless of the lender, you've still got to be prepared to put in a good loan application. Check out our top home loan application tips.

Cashback Offers & Deals

Some lenders have offers designed to entice you to take out a loan or refinance with them. One example is cashback offers, where there is a cash incentive (normally a few thousand dollars) to do so. However, it's important to consider such perks alongside the fundamentals of the loan - namely its interest rate and fees.

Grants & Government Assistance

Particularly if you're a first home buyer, it's worth checking out whether you qualify for support from your state/territory or federal government to help you get your foot in the door. Current government support for home buyers includes:

• First home buyer grants: One-off grants between $10,000 to $30,000 (depending on the state) for certain buyers buying or building a new home under a certain value

• Stamp duty concessions: Discounted or waived stamp duty for first home buyers of certain properties

• Home Guarantee Scheme: Federal government guarantees (the First Home Guarantee, Regional Home Guarantee and Family Home Guarantee) that enable buyers to purchase a home with a deposit as low as 5% (or as low as 2% for the Family Home Guarantee) without being charged LMI.

Are low home loan rates important?

Having a lower interest rate on your home loan is important given 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 loan with a lower interest rate can save you a lot of money. Allow us to demonstrate.

How much can you save with lower rate?

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 (assuming a 30-year loan term).

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

What affects your home loan rate?

• Whether you're on a fixed or variable rate: If interest rates are expected to go down in the coming months, fixed rates tend to be lower than variable rates, since on one would fix knowing they could instead borrow at a rate that's likely to be reduced. When rates are expected to go up, fixed rates are generally higher than variable.
• Loan to Value Ratio: High LVR loans generally have higher interest rates to compensate the lender for the perceived added risk.
• RBA cash rate: The Reserve Bank of Australia sets the rate banks charge when lending to one another. Variable home loan rates generally fluctuate directly in line with the cash rate while fixed rates tend to change based on the direction markets expect the cash rate to head in the near future.
• Fees: Some products have low rates but charge high fees. This is one of the reasons why it's so important to check the comparison rate as well as the advertised rate when comparing home loans.

How to find the cheapest or best home loan interest rate for you

Securing the lowest interest rate on a home loan is easier said than done, with the lowest rates typically reserved for borrowers with strong credit ratings and loan-to-value ratios (LVRs) of 60% or less.

You may also find the loans with the lowest interest rates don't particularly suit your needs or have the features and level of customer support that you're after.

For instance, the lowest-rate loan on the market might be a fixed-rate loan with limited features offered by a small regional bank. However, you might instead be after a variable-rate loan with an offset account from an online lender boasting the latest fintech tools (e.g. mobile apps, speedy loan application software).

With that in mind, here are a few things to consider when looking for a good home loan interest rate:

Look for a low comparison rate

A home loan comparison rate is a rate lenders are legally required to display alongside advertised interest rates on home loans to give borrowers a truer reflection of a loan's cost - taking things like fees and revert rates into account. They essentially make home loans easier to compare (hence the name). So seek out loans with low comparison rates because they're more likely to have a low interest rate and low fees.

Fixed, variable or split rate?

Think carefully about whether you want a fixed or variable interest rate - or even a split rate to give you a mix of both - because there are important pros and cons to both that should be considered:

Fixed rate pros:

• Peace of mind that your repayments won't increase over the fixed term

• Can generate big interest savings if you opt for a low fixed-rate ahead of large interest rate rises (Read more: The lucky ones that fixed)

Fixed rate cons:

• Could be stuck paying a higher rate than those on variable rates if you fix at the wrong time

• If you refinance or sell your home during the fixed-term, you face paying large break costs

Variable rate pros:

• Interest rate may fall in the event of an RBA cash rate reduction

• Generally more flexibility than a fixed-rate loan (e.g. can come with offset account, usually no limit to extra repayments)

Variable rate cons:

• Interest rate will rise in the even of an RBA cash rate increase

• Lender can increase your interest rate at their discretion (even without an RBA rate rise)

Principal & Interest or 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.

Are introductory rates worth it?

Some low rate loans have introductory rates, which charge a lower rate for short time (the honeymoon period) before reverting to a higher rate. Consider whether the interest savings generated during the introductory period are worth the cost of the higher revert rate at the end of it, or for that matter the hassle of having to refinance to a lower rate!