Compare home loans
7000+ home loan rates based on product reference data from 100+ CDR data holders (participants in open banking).
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* Comparison rate is calculated on a loan amount of $150,000 over 25 years. Rates and fees are subject to change. Terms and conditions apply.
+ Only key fees (application, discharge, ongoing) are displayed - other fees such as redraw, administration, and processing fees may also apply.
What's new in home loans in 2025?
The Reserve Bank of Australia has now delivered three cash rate cuts in 2025, bringing the official rate down to 3.60%.
For borrowers, the savings are starting to add up. Take someone with a $750,000 home loan over 25 years. The recent rate cuts mean their monthly repayments are now around $340 lower than they were at the start of the year.
Experts point out that banks often reserve their best deals for new customers, leaving loyal borrowers on higher rates. Right now, some of the lowest variable rates in Australia are starting with a 4.
Whether you’re searching for your first mortgage, or checking if it’s time to refinance home loan rates, comparing options could help you save thousands.
Don’t overpay your hard-earned money to the banks when a better deal may be just a few clicks away.
What to watch out for when comparing home loans
Interest rate vs comparison rate
The interest rate shows the base cost of borrowing, but it doesn’t tell the full story. The comparison rate includes most fees and charges, giving you a clearer picture of the true cost of a loan. However, remember that the comparison rate calculation assumes a fixed loan size and term. Consider both numbers before deciding to find a competitive deal.
Fees and charges to watch
Home loans often come with application fees, monthly or annual account fees, and break costs if you leave early (especially for fixed rate loans). These charges can add up to thousands over the life of a loan. Look beyond the interest rate and consider the associated fees when working out the actual cost of a loan to you.
Features that make a difference (offset, redraw, repayment options)
Plain vanilla or choco chip? Choosing a home loan isn’t just about your taste buds. A basic loan may be cheaper upfront, but sometimes paying for extra features can save you money in the long run. For example, an offset account lets you use your savings to reduce the interest charged, while redraw facilities give you access to extra repayments if needed. Flexible repayment options, like making extra payments without penalty, can also help cut years off your mortgage.
Loan-to-value ratio and borrowing power
Your loan-to-value ratio (LVR) is the size of your loan compared to the value of the property. Borrowing above 80% usually means paying Lenders Mortgage Insurance (LMI), which can be expensive. However, some lenders may offer professional discounts or allow you to borrow more than 80% of the property’s value without LMI. A mortgage broker can help you explore these options and find a lender that suits your situation.
What are the various type of home loans?
When comparing home loans, it helps to know the different types available in the market. Different loans have different features and may suit some borrowers more than the others. Here’s a lowdown of some of the popular home loan types you’re likely to come across:
Owner-occupier home loans Designed for individuals who are looking to buy a property to live in. These loans usually come with lower interest rates and flexible features.
Investment home loans Offered to borrowers purchasing a property to rent out. Rates are typically higher than owner-occupier loans, and lenders may apply stricter eligibility criteria, especially around your borrowing power and deposit size.
Fixed-rate home loans You can lock in your rate for a set term, typically 1–5 years. During this time, your repayments stay the same, making budgeting simple.
Variable-rate home loans Your rate moves up or down with the RBA cash rate and market conditions. Often come with more flexibility in terms of features as compared to fixed-rate home loans.
Split home loans Part fixed, part variable, offering you the stability of fixed repayments and the flexibility of benefitting from market changes.
Specialty loans Designed for unique needs, including:
- Construction loans – For borrowers constructing a home or getting major repairs to their home. Funds released in stages as your home is built.
- Bridging loans – A short-term finance option to bridge the financial gap when buying a new property before selling your current one.
- Low-doc loans – Designed for self-employed borrowers who can’t provide standard income documents.
- SMSF loans – Property investment through a self-managed super fund.
- Reverse mortgages – A type of mortgage that allows older Australians to access home equity.
Who offers the cheapest home loans?
Australia’s Big Four banks—ANZ, Commonwealth Bank, NAB and Westpac—still dominate the mortgage market. But challenger banks and non-bank lenders are making inroads with sharper rates and simpler products.
Why non-banks are often cheaper:
- No large branch networks
- Lower compliance costs
- Different funding sources
- Pass savings on as lower rates & fewer fees
So who offers the lowest rates? The Big 4 or the challengers?
Let's talk numbers. The biggest factor affecting your mortgage cost is the interest rate, and the difference between lenders can be significant. As of 2025, the average interest rate for a new home loan in Australia is around 5.76% per annum.
Here’s the key difference: the Big Four are offering rates from around 5.19% for some loans, but many non-bank lenders go even lower, with some starting at 4.75%.
That 1% gap might seem small, but on a $500,000 loan over 30 years, it could save you more than $100,000 in interest. That’s enough for a new car, a few holidays, or a big boost for your kids’ education.
But, is cheapest always the best?
While it’s tempting to chase the lowest advertised rate, the right home loan for you is the one that suits your situation. For example, a slightly higher rate with an offset account could save you more if you keep money in savings. Similarly, redraw facilities and flexible repayment options can shorten your loan term. When it comes to your home loan, it is not just about bagging the lowest rate, but finding a mortgage that matches your financial situation.
There's also the question of financial risk, eligibility and approval.
Cheaper rates don’t always mean easier approval. Big banks often apply tighter credit checks, especially for first-home buyers. Non-bank lenders may be more flexible—but this can increase risk if your financial situation changes.
The Reserve Bank of Australia points out that some non-bank loans have higher loan-to-income ratios, which can put borrowers at more risk if things change. It’s important to weigh the short-term benefit of easier approval against the long-term risk of repayment pressure.
And the hidden fees; the nasties
A loan with a low rate but high fees can still cost you more. The Big Four are known for higher upfront and ongoing charges, while non-banks often waive fees or keep them minimal.
Always check the comparison rate, as well as the interest rate, to understand the real cost of the loan to you.
Getting your foot in the door: A guide for first home buyers (FHBs)
Leverage first home buyer schemes
There’s significant value in Australia’s Home Guarantee Scheme (First Home Guarantee). As a first-home buyer, you may only need a 5% deposit and can avoid paying Lenders Mortgage Insurance (LMI)—a major cost saving.
From 1 October 2025, there will be no cap on the number of guarantees available and property price caps will be increased, making many more homes eligible for the scheme.
Some states and territories also help first home buyers through a first home buyer grant that can be used towards your deposit. Check your state or territory government’s website for more info on such grants. You may also qualify for stamp duty rebate.
Track interest rates closely
A home loan is not a set and forget financial product. The RBA has cut the cash rate three times this year, and further cuts are expected.
What does this mean for you?
Lower interest rates make mortgages more affordable. Your monthly repayments will be lower, and you may be able to borrow a larger amount. While experts say housing is still expensive, these rate cuts are a welcome relief and could help you enter the market.
Prepare your financial profile before you apply
Lenders want to see that you’re a low risk borrower. Steps to prepare include:
- Check your credit score. You can also download your credit report from Equifax or Experian and correct any errors.
- Improve your financial situation by paying down high-interest debts, such as credit cards and personal loans to maximise borrowing capacity.
- Your payment history is a massive factor. Set up automatic payments for bills so you never miss a due date.
- Demonstrate steady employment and consistent savings habits, even small regular deposits, as this shows financial discipline.
- Consider reducing unused credit card limits, as lenders view available credit as potential risk even if you don't use it.
Carefully preparing your financial profile and staying informed about government initiatives and interest rate trends can help you get your foot in the door as a first home buyer.
Decoding the fine print: rates, fees and sneaky offers
The home loan market is highly competitive, and lenders use lots of tactics to grab your attention. It’s essential to look beyond the ads and understand what a loan will truly cost you.
What's really driving your interest rate?
The biggest single influence on Australian home loan rates is the official cash rate set by the Reserve Bank of Australia (RBA). When the RBA cuts the cash rate, lenders' funding costs decrease, and they usually pass these savings on to borrowers in the form of lower interest rates.
Forecasts for the remainder of 2025 suggest that further cuts could be on the way, potentially bringing rates down even further. Staying informed about the RBA's moves can help you time your application or refinancing decision to your advantage.
The cashback conundrum: a good deal or a gimmick?
Who doesn't love free cash? Lenders are aware of this, which is why cashback offers of $2,000, $3,000, or even more have become a popular tool for attracting new customers. But is it a genuine perk or a clever trap?
Often, it's a bit of both. Loans with cashback deals frequently come with a slightly higher interest rate. For example, a loan might offer $2,000 in cash back but have an interest rate of 6.24% per annum, while a similar loan without cash back could have an interest rate under 6%. One expert analysis warned that a borrower taking a $2,000 cash back offer could end up paying nearly $12,000 more over the life of the loan due to the higher interest rate.
Cashback offers can help cover refinancing costs, but it’s important to calculate the total cost of the loan over several years, including any higher interest payments. Often, choosing a lower interest rate will save you more money over time.
Beyond the interest rate, a host of fees can bloat the cost of your mortgage. Keep an eye out for:
- Application/Establishment Fees: A one-off charge for setting up the loan, which can be several hundred dollars.
- Valuation Fees: The lender will charge you for the cost of having your property professionally valued.
- Settlement Fees: An administrative fee for the finalisation of the loan.
- Lenders Mortgage Insurance (LMI): If your deposit is less than 20%, this insurance (which protects the lender, not you) can add thousands to your loan amount.
- Ongoing Fees: Some loans have annual or monthly account-keeping fees that can gradually erode your finances.
These fees can total 1-3% of your loan amount. Always ask your lender for a full list of all costs before you commit.
What lenders are looking for in 2025
So, what are the key factors lenders consider when they look at your application?
- Income Stability: They want to see a consistent and reliable income stream to be confident that you can make your repayments on time.
- Credit Score: A clean credit history is non-negotiable. It’s a direct reflection of your creditworthiness.
- Deposit and Savings: A larger deposit reduces the lender's risk. A history of genuine savings is also highly valued as it shows financial discipline.
- Existing Debts: Lenders will look at your total liabilities, including credit cards, car loans, and personal loans, to calculate your debt-to-income ratio.
New trends are also emerging. Fintech innovations are streamlining the application process, while a growing trend towards regional migration is changing how lenders assess property locations. Lenders are becoming increasingly sophisticated and utilising more data than ever before to inform their decisions.
The home loan market can be tough, but you have more control than ever. With more lenders, better information, and handy comparison tools, you can take charge and make smart choices.
By learning about your options, avoiding the loyalty tax, and seeing through marketing tricks, you can take control of your home loan journey. With the right information, you can reach your goal of owning a home in Australia.
Here are some immediate steps you can take to get started on your home loan journey:
1. Check Your Eligibility
Assess your financial health and check your eligibility for any government grants or schemes that may be available, like the First Home Buyer Guarantee.
2. Compare Rates
Use comparison tools to evaluate interest rates and other loan terms from different lenders, ensuring you get the most competitive deal.
3. Contact a Broker
Consider reaching out to a mortgage broker who can offer personalised advice and help navigate the complexities of the loan process. When choosing a broker, it's important to ensure they are accredited by relevant industry bodies such as the Mortgage & Finance Association of Australia (MFAA) or the Finance Brokers Association of Australia (FBAA). Check their track record and read reviews from past clients to gauge their reputation and reliability. A trustworthy broker should be transparent about fees, communicate clearly, and align their services with your financial goals.
