Assuming a 30-year loan term, if you switched to that lower rate your monthly repayments would drop from $4,368 to $3,721. That's a saving of $647 every month, or $7,764 a year.
Data is correct as of 1 December 2025. This savings example is a hypothetical estimate only. The lowest rate is for an owner-occupier loan with 80% LVR.
Market update by Rebecca Pike – Finder's senior home loans writer
What is a home loan?
A home loan is the money you borrow to buy a property. You save a deposit first, which is usually 5-20% of the property's value and then you borrow the rest. This is your loan amount or your loan principal.
Your lender charges you interest based on the loan principal amount and your home loan's interest rate. The higher the home loan interest rate, the higher your repayments will be.
How do I compare home loan interest rates?
A good home loan comparison starts with a careful look at interest rates. The lower the rate, the lower your repayments will be.
Let's compare 2 otherwise identical home loans with slightly different interest rates.*
Interest rate
6.44%
4.99%
Loan amount
$678,010
$678,010
Loan term
30 years
30 years
Monthly repayment
$4,259
$3,636
Monthly saving
N/A
$623
Annual saving
N/A
$7,476
As you can see, with the lower interest rate, you save $623 a month – or $7,476 a year.
*We're using the average owner-occupier home loan size from the latest ABS figures, the average variable rate loan in Finder's database of the full market and the lowest variable rate.
How do I compare home loan fees and features?
The interest rate is the most important factor you'll want to compare to determine how much your loan will cost you. But fees and features are also really important.
Application fees. This one-off fee can run as high as $600.
Ongoing fees. Some loans come with a monthly or annual fee, usually worth around $120 a year or $10 a month. Package loans have an annual fee of up to $500.
Valuation fees. This covers your lender's cost to have your property professionally valued. It can cost several hundred dollars.
Discharge fees. A discharge fee is only charged when you end a home loan, either by refinancing or paying off the loan.
Comparing home loan features
The following are the most common and useful home loan features:
Offset account. A 100% offset account is a bank account attached to your home loan. Functioning like any other bank account, any money held in the account reduces the amount of the loan you're charged interest on. It's not available with every loan, such as fixed rate and basic loans. Many offset loans attract a monthly or annual fee, or a higher rate.
Extra repayments. If your loan allows you to make extra repayments, you can pay it off faster. This will save you in interest charges. These days, most variable rate loans allow extra repayments, although some fixed rate loans don't.
Redraw facility. A redraw facility is common on home loans that allow extra repayments. A redraw allows you to withdraw extra repayments from your loan and spend them if you need to. Some lenders charge a redraw fee or restrict how much money you can access.
Split facility. Some loans allow you to split your mortgage into both fixed and variable portions. This lets you create a flexible loan that offers the benefits of both a fixed and variable rate.
Look at a home loan's comparison rate
The comparison rate is designed to help borrowers understand the true cost of a loan by adding in fee costs over time. But it's only a hypothetical calculation based on a specific loan amount and term. It's not that useful because every borrower's situation is unique.
You're better off working out how much your loan will cost you every month and factoring in the cost of fees on top of that.
Our expert says
"I've switched my home loan 6 times in the last 10 years. Each year, I'll search and compare for a better deal. My thinking is, why spend more on my home loan than I need to? Whether you're getting your first loan or you're fifth, it's not as hard as you might think. Be clear on the features you want (like offset or redraw), and look at both the fees and the interest rate to work out the best deal for you."
Variable rates can change at any time, but it's easier (and fewer fees apply) to switch to a new loan or make extra repayments.
Fixed rates don't change but are often slightly higher and less flexible (harder to exit the loan or make extra repayments).
Most borrowers choose home loans with principal-and-interest repayments. This means you borrow the money (principal) and pay it back each month, plus interest on top.
There is another option, which is interest-only repayments. This type of home loan starts out cheaper because you don't pay any principal at the start. You just pay the interest charge on top. But later, you'll have to pay the principal back and you'll end up paying more.
To the ordinary person looking to buy a property, there's usually no actual difference between the words "mortgage" and "home loan". They are used interchangeably to mean the money you borrow to buy a property.
However, if you want to get very technical, a home loan refers to the money you borrow. The mortgage is a legal document that ties you and your property to the lender. In the event you cannot repay the home loan, the mortgage acts as the lender's security and gives it the right to sell your home to recover your debt.
Home loan approval times vary from lender to lender and also depend on how complex your borrowing situation is.
A lender may be understaffed or very busy when you apply, and an approval might take several weeks. Some online lenders have developed faster digital approvals that allow them to process an application in a matter of days. A big bank may take weeks to approve a loan.
If you have all your loan paperwork, financial information and identity documents organised, the approval process might be faster.
If you're finding it too hard or confusing to compare home loans, a mortgage broker can help. Brokers are qualified professionals who compare home loans for you. They don't compare every loan on the market, but they have access to a panel of up to 30 lenders – and sometimes more.
It's tough to definitively state what the cut-off point is for getting home loan approval, as banks and lenders consider their own internal credit assessments along with your score when reviewing your application.
However, credit score providers like Experian do have benchmarks that can be useful in getting an idea of how likely you are to be approved for a home loan. Below is a guide of how your credit score could influence your home loan approval odds with Experian, who run their credit scores between 0 and 1000. The higher the number, the better your credit score is.
Excellent: A score between 800-1,000 is considered Excellent. This means the bank view you as being extremely low risk of defaulting on your loan. If your score is in this range, home loan approval is likely. Very Good: A score from 700-799 is considered Very Good and puts you in the second-top tier of creditworthiness. Most lenders would look very favourably on your application. Good: A score from 625-699 is classified as Good. This still puts you in good standing and the bank views the likelihood of an "adverse event" occurring on your credit file in the next 12 months to be low. Fair: A score from 550-624 puts you in the Fair category. This means you're more likely to suffer an adverse event on your credit file in the next 12 months, so lenders may apply additional loan criteria or charge you a higher rate. Weak: Any score below 549 puts you in the Weak category. Lenders consider the likelihood of an adverse credit event high. You may have trouble obtaining finance from traditional lenders.
There are many lenders in the Australian mortgage market. Most of them are regulated as banks, and all of them must follow the National Credit Code.
The Big Four banks. The Big Four are the dominant players across Australian banking. Most customers stick with Commonwealth Bank, NAB, Westpac or ANZ. They all offer banking apps, large customer service teams, extensive branch and ATM coverage, and lots of mortgages to choose from. You won't get the absolute lowest rates with the Big Four, but they are always competitive.
Other banks. There's more to mortgages than the biggest players, of course. There are state and regional banks as well as nationwide operators and local arms of international banks like ING and Citibank.
Digital banks, fintechs, neo-banks and online lenders. There are lenders that do business entirely online (with phone support). Lenders such as loans.com.au, Tiimely Home and UBank are examples of online lenders with competitive rates. Some newer players in the market include neobank or fintech lender like Athena, which use apps and big data to offer customers a convenient online mortgage experience.
Banks, credit unions, building societies and online lenders are supervised by the Australian Prudential Regulation Authority (APRA) as authorised deposit-taking institutions (ADIs).
Lenders are also subject to the National Credit Code, which is administered by the Australian Securities and Investments Commission (ASIC) under the National Consumer Credit Protection Act (2009).
Some smaller lenders may not be treated as ADIs. The main drawback here is that if you have money saved with the lender (in a savings account or offset), you might not be covered by the bank guarantee if the lender goes bust.
The loan-to-value ratio (LVR) is another way of defining the minimum deposit you have to save. Banks prefer a maximum LVR of 80%, meaning you need a 20% deposit. Many loans also have a maximum insured LVR of up to 95%. This means that you can get the loan with a smaller deposit, but you will need to pay lenders mortgage insurance (LMI) if your deposit is under 20%. Some professions enable higher LVRs without the need for LMI. Typically these professions include doctors, lawyers and accountants, and more recently police officers, nurses and other university trained occupations, but different banks have different policies in relation to this benefit.
Although you possibly can get a home loan while on maternity leave, lenders may see you as a riskier borrower because your income is reduced. This means you would not be able to borrow as much as you would on a full income.
There are a few things you could do to improve your chances of being approved:
Get documention from your employer detailing the terms of your maternity leave, such as the dates and your salary upon your return.
Save at least a 20% deposit.
Set a realistic budget and loan amount.
Talk to multiple lenders before applying. Too many rejected applications will look bad on your credit report, so be sure you get the answers before you apply.
Consider talking to a mortgage broker.
If you want to increase an existing home loan, you may be able to do this while on maternity leave. The increase would need to be a reasonable amount with a lender who will accept you and you can prove that you can afford it.
The vast majority of Australian borrowers get home loans with 30-year loan terms. This is the maximum amount most lenders allow. But it is possible to get a loan with a longer term of 40 years. A 40-year home loan is otherwise identical to other home loans: You borrow money and pay it back with interest charged on top.
The difference is the time involved and the amount of interest you pay. The main benefit for borrowers who take out 40-year loans is that they pay reduced ongoing repayments, as the debt is structured over a longer time period. The main drawback is that because they have their loan for longer, they end up paying a higher amount of interest in total.
It's a really good idea to talk to a mortgage broker before committing to a 40-year home loan.
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With over 20 years of experience in property, finance and investment journalism, Sarah is a trusted expert whose insights regularly appear across television, radio, and print media, including Sunrise, ABC News, and Yahoo! Finance. She has previously served as managing editor for Your Investment Property and Australian Broker, and her expert advice has been shared in the media over 3,500 times since 2023 alone. Sarah holds a Bachelor’s degree in Communications and a Tier 1 Generic Knowledge certification, which complies with ASIC standards.
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Comparing home loan fees
Comparing home loan features
Look at a home loan's comparison rate
