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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
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000
5.75% p.a.
5.88% p.a.
$2,334
Principal & Interest
Variable
$8
$600
60%
5.79% p.a.
6.08% p.a.
$2,344
Principal & Interest
Variable
$299
$0
80%
5.92% p.a.
5.98% p.a.
$2,378
Principal & Interest
Variable
$0
$400
90%
5.94% p.a.
5.99% p.a.
$2,383
Principal & Interest
Variable
$0
$600
80%
5.94% p.a.
5.95% p.a.
$2,383
Principal & Interest
Variable
$0
$0
90%
5.94% p.a.
5.95% p.a.
$2,383
Principal & Interest
Variable
$0
$180
80%
5.99% p.a.
5.99% p.a.
$2,396
Principal & Interest
Variable
$0
$150
60%
5.99% p.a.
5.90% p.a.
$2,396
Principal & Interest
Variable
$0
$0
80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
5.99% p.a.
6.01% p.a.
$2,396
Principal & Interest
Variable
$0
$210
70%
5.99% p.a.
6.51% p.a.
$2,589
Principal & Interest
Variable
$0
$530
90%
5.99% p.a.
6.00% p.a.
$2,396
Principal & Interest
Variable
$0
$0
60%
6.14% p.a.
6.49% p.a.
$2,434
Principal & Interest
Variable
$395
$0
60%
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
90%
4.5 STAR CUSTOMER RATINGS
  • Low rates for purchase and refinancing
  • Simple online application process
  • No fees, unlimited redraws, 0.10% offset 
6.09% p.a.
6.11% p.a.
$2,421
Principal & Interest
Variable
$0
$210
80%
6.04% p.a.
6.08% p.a.
$2,408
Principal & Interest
Variable
$0
$595
80%
5.98% p.a.
6.42% p.a.
$2,393
Principal & Interest
Variable
$350
$0
90%
6.04% p.a.
6.04% p.a.
$2,408
Principal & Interest
Variable
$0
$0
60%
6.08% p.a.
6.14% p.a.
$2,419
Principal & Interest
Variable
$0
$840
90%
6.08% p.a.
6.12% p.a.
$2,419
Principal & Interest
Variable
$0
$495
90%
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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 .



What is a variable home loan rate?

A variable rate home loan is a home loan where your interest rate will move up or down over the loan term. Interest rate fluctuations can happen at any time according to the lenders' wishes but they generally occur in line with changes to the official cash rate, which is set by the Reserve Bank of Australia (RBA). For example, if the official cash rate falls, it’s likely your lender will drop their home loan interest rates as well (and vice versa if the official cash rate rises).

Variable rate home loans can be more difficult to budget for than a fixed loan because you have to take into account potential rate rises or falls, which will impact your repayment amount.

How do you compare variable rates?

You can find which variable-rate home loans offer the maximum savings and lowest cost by using the comparison rate.

The comparison rate of a variable-rate home loan reflects the “true cost” of the loan. It considers not just the interest costs but also the other fees embedded into the loan.

While it is easy to point out which home loans have the lowest variable rate, it is still crucial to take note of the comparison rate.

Some home loans have low variable rates but charge higher fees. In such circumstances, it is much better to get a higher variable rate but with minimal fees.

Why choose a variable home loan rate?

In Australia, variable rate home loans are more popular than fixed rate home loans among borrowers.

Variable rate home loans can be more preferable to fixed rate home loans because they offer more flexibility. Variable rate home loans are generally more likely to offer appealing features like a redraw facility, offset account, or the ability to make extra repayments to help you pay off your loan sooner.

Variable rate home loans can be more preferable to fixed rate home loans if the official cash rate is falling as it means there’s a good chance your lender will also drop your home loan interest rate. If you were on a fixed interest home loan, you would miss out on these rate cuts during your fixed term. However, if you’re on a variable rate home loan and the official cash rate rises, it’s likely your lender will also then increase your home loan interest rate - whereas if you were on a fixed rate loan, your rate would stay the same.

Features of variable rate home loans

A variable-rate home loan is a flexible option that allows borrowers to enjoy several loan features. The loan features variable-rate borrowers can enjoy include:

Types of variable rate home loans

Variable-rate home loans can be classified into several types.

The first type is called the standard variable home loan. This is the most flexible type of variable home loan as it offers the maximum range of optional features that can help you save more in interest costs. However, standard variable home loans often have a higher interest rate.

If you want a no-frills option that bears the lowest interest rate, the basic variable home loan is the one for you. It bears a lower interest rate, which means lower repayments. The major drawback is the lack of features.

Discounted variable rates are the third option — many lenders offer discounts depending on loan size, loan-to-value ratio, or income. Others even provide discounted variable rates depending on whether you are a first-home buyer.

How long do variable rates last?

Variable rates are the default interest rate of home loans. Over the life of the loan, your loan will have a variable interest rate unless you decide to fix it.

Once you have locked in your interest rate, you will now have a fixed-rate, which can last between one to five years before it reverts back to a variable rate.

What causes the rise and fall in variable rates?

Variable rates tend to follow the cash rate target of the RBA. When the cash rate declines, lenders usually pass on the discount to their borrowers. The same goes for instances of cash rate increases.

Lenders can also make out-of-cycle changes to variable rates, depending on situations such as funding issues, regulatory changes, and fluctuations in market conditions.

Frequently Asked Questions

Yourmortgage.com.au helps to answer these frequently asked questions to assist home buyers on finding the best variable home loan rates in the market.

Refinancing from a variable home loan to a fixed loan is much simpler than refinancing from fixed to variable, which can attract hefty break costs and discharge fees.

Variable mortgage rates are subject to change at the lenders' discretion but generally fluctuate in line with any changes the Reserve Bank makes to the official cash rate.

You can pay off a variable home loan early by making extra or early repayments, which could potentially save you thousands in interest over the life of the loan. Unlike fixed home loans, you won’t be charged an early exit free for repaying your variable mortgage off early.

Not necessarily - variable rates can rise or fall depending on what’s happening with the official cash rate, so they may not always be higher than fixed rates. In fact, historically variable rate home loans have generally been lower than fixed, but this has changed a bit over the last few years with interest rates falling to historic lows. If fixed rates are lower than variable rates, it’s likely it means the lender expects rates to remain low for some period.

If interest rates are on the decline, it could make more sense to have a variable interest rate so you can benefit from rate drops. However, if interest rates are currently low but likely to rise in the near future, it could make more sense to lock in that lower rate with a fixed mortgage. Fixing your interest rate can be a bit of a gamble because you’re essentially taking a bet on whether your lender will increase or lower your rate.

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