ACCC modelling found that borrowers with home loans between three and five years old paid an average of 58 basis points (0.58%) more than the average interest rate on new loans.

According to the Australian Securities and Investments Commission (ASIC), the average interest rate in September was 2.62% p.a.

The ACCC says with a home loan of $250,000, refinancing could save $1,400 in interest in the first year, and over the remaining term, the borrower could save more than $17,000 in interest.

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.

Update resultsUpdate
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.
Principal & Interest
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.
Principal & Interest
Featured Apply 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.
6.14% p.a.
6.16% p.a.
Principal & Interest
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
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.

Among a raft of recommendations, the ACCC has recommended lenders be required to 'regularly' prompt borrowers whose loans are older than three years to review their current interest rate. 

“A significant number of Australian home loan borrowers have not switched lenders for several years, yet they stand to save so much money by doing so,” ACCC Chair Rod Sims said.

“There are factors standing in the way of home loan borrowers switching lenders, such as a lack of clear and transparent pricing, as well as inconvenience and time costs, but for many borrowers switching will be worth the effort.”

Mr Sims also said Consumer Data Right will make the refinancing process easier.

“We remain concerned about opaque pricing in the home loan market, but are encouraged that some banks are moving to more transparency without direct intervention from the government,” he said.

“We are recommending ongoing monitoring of this market so we can ensure that this trend of improved pricing transparency continues. We may recommend further action if it does not.”

'Sticky' products and refinancing

The $250,000 yardstick the ACCC has used could be a conservative measure - the average loan written, according to lending indicator figures, in October was more than $566,000. 

External refinancing was down, in original terms, to about $7.7 billion in October - down from highs of nearly $10 billion in May. 

October had an average external refinancing loan size of nearly $474,000.

However, internal refinancing was up in October from September to nearly $4.8 billion, though this is still down from May's highs of nearly $5.3 billion.

October's internal refinancing had an average loan size of nearly $416,000.

After the Reserve Bank's (RBA) cash rate cut to 0.10% in November, many lenders moved to introduce home loans with advertised rates under 2%, yet very few of these were variable.

Instead, many of the latest offers lock-in borrowers for upwards of three years, to packaged home loans that also include credit cards and other products.

The ACCC also proposed a time limit of 10 business days for lenders to complete the discharge authority process. 

Mr Sims said lenders at present have no incentive to make the discharge process "quick or straightforward".

“We want it to be as easy as possible for borrowers to switch lenders, as it should be in all markets. Our recommendations are designed to make this process faster, less confusing and less frustrating," he said.

The RBA has also provided a $200 billion 'term funding facility' (TFF), which enables banks to access low-cost funding at 0.10% per year over three years: the same amount of time many lenders are offering their competitive fixed home loans for.

As of August, CommBank, for example, had accessed $31.4 billion in the TFF. 

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