Home loans with unlimited additional repayments

Extra repayments help you get out of debt faster. Compare home loans that let you do this without paying a fee.

PiggybankHome loans with unlimited additional repayments can save you a great deal of money over the long run. Even an extra repayment of just $100 per month cuts down your principal balance faster, reducing the loan amount and therefore the amount of interest you're paying.

This feature is usually available with variable rate home loans. You may be able to make additional repayments on a fixed rate loan, but these are generally limited to a certain amount.

Comparison of home loans with unrestricted extra repayments

Rates last updated October 18th, 2018
$
Loan purpose
Offset account
Loan type
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Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
3.49%
4.57%
$0
$395 p.a.
90%
Loans over $150k get a discount off an already low fixed rate. Available for NSW, QLD and ACT residents only.
3.54%
3.58%
$0
$0 p.a.
80%
Get a competitive rate, save on fees and access a 100% offset account plus redraw facility. $900 cashback offer.
3.59%
4.14%
$395
$0 p.a.
80%
A one year fixed rate offer with no ongoing bank fees.
3.59%
3.62%
$0
$350 p.a.
90%
Get a low variable interest rate and buy a property with just a 10% deposit. 100% offset account attached.
4.39%
4.78%
$0
$395 p.a.
95%
Enjoy a discounted rate with this variable rate package home loan.
3.59%
3.58%
$0
$0 p.a.
80%
Apply online and get fast approval for this fixed rate, low-fee loan with redraw facilities. Add a 100% offset account for a small fee.
3.62%
3.62%
$0
$0 p.a.
95%
A low deposit mortgage with a competitive rate and plenty of flexibility. QLD residents only. Eligible borrowers can get a 15% discount on home and contents insurance for the life of their loan.
3.64%
3.66%
$0
$0 p.a.
80%
A simple mortgage with a competitive interest rate and no application or monthly fees. Borrow up to $2 million from a convenient online lender.
3.57%
3.58%
$0
$0 p.a.
80%
Get a very low interest rate and pay fewer fees. Enjoy a fast online application process and add a 100% offset account for $10 a month.
3.64%
3.66%
$0
$0 p.a.
90%
Get a low interest rate loan with no ongoing fees. Plus you can make extra repayments and free redraw online. Available with just a 10% deposit.
3.67%
3.69%
$0
$0 p.a.
80%
Family guarantee option available. Enjoy flexible repayments and a low minimum loan amount.
3.68%
3.70%
$0
$0 p.a.
80%
This loan offers a competitive variable rate and a 100% offset account to help save you on interest repayments.
3.69%
4.12%
$0
$395 p.a.
80%
Unlock a range of savings with this competitive package home loan offer. Offset account and redraw facility included.
3.76%
4.15%
$0
$395 p.a.
90%
A high maximum LVR home loan with redraw facility and additional payments. Get this mortgage with a 10% deposit.
3.79%
3.80%
$0
$0 p.a.
90%
Get one free online redraw per month and pay no ongoing fees. Application fees are waived for loans above $150,000.
3.79%
3.79%
$0
$0 p.a.
80%
Access an offset account and pay no application or ongoing fees on this special variable rate for owner-occupiers.
3.84%
4.53%
$0
$395 p.a.
90%
Enjoy discounts on banking products and insurance with this package loan. NSW, QLD and ACT residents only.
3.89%
3.94%
$0
$0 p.a.
90%
Borrow up to 90% of the value of the property you're buying, and pay no application fee.
4.65%
5.02%
$0
$395 p.a.
95%
An award-winning package home loan which allows regular additional repayments and lump sum payments.
5.95%
6.11%
$600
$10 monthly ($120 p.a.)
95%
A no frills home loan with a 100% offset account and high maximum LVR.

Compare up to 4 providers

How much do you stand to save with unlimited repayments?

Dave is trying to secure a home loan of $150,000 that allows for an unlimited amount of extra repayments, and wants to check first that he's not being charged any types of fees for this feature.

With this loan amount spread out over a thirty year term at an interest rate of 5.5% p.a. and monthly regular repayments, he could cut his terms down by six years and three months just by making an additional repayment of $100 per month after the first year. The amount Dave would save in interest over the life of the loan would be an astonishing $36,838.14.

You can use our calculator to work out how much extra repayments could save you on your home loan.

How does a home loan with unlimited additional repayments work?

When you have a home loan that offers a feature like unlimited additional repayments, you won’t be penalised if you pay over a certain amount over the expected loan repayment for the year. As mentioned above, this feature is typically only found on a variable rate home loan. Making payments towards a fixed rate when you're not meant to, or making extra repayments above the allowed limit can come with hefty break costs, which can outweigh the benefits of making extra repayments in the first place. These home loans don't have a limit and therefore don't penalise borrowers for making extra repayments.

You can choose to make additional repayments in large lump sum amounts or just by adding a small amount to your repayment each week, fortnight or month. The more extra money you put towards your loan, the faster you will be able to pay it off.

Fixed rate home loans that allow additional repayments

How to compare these types of mortgages

  • Fees and restrictions. While a lender could let you make unlimited additional repayments, they could also charge you for doing so. If this is the case, make sure that the money you’re saving from making extra repayments outweigh the fees.
  • Redraw facility. You never know what surprises lay ahead for you tomorrow. When shopping for a home loan with unlimited additional repayments look for those with a redraw facility. This feature will allow you to withdraw any additional repayment you may have made on your loan if you suddenly find yourself in need of that extra money.
  • Special terms. In some cases, you may only be allowed to take advantage of this benefit for a limited amount of time. Read the fine print carefully to make sure that you will have this feature available for the life of your loan if it's required.
  • Early exit fees. There are some lenders who will welcome additional repayments but charge you a fee if you terminate your home loan early than the terms dictated. Look for this fee when examining the fees of all of the home loans you are interested in.
  • Split loans. Some home loans offer the option of splitting your home loan into a variable and fixed rate loan. Check to make sure you are not penalised if you make too many additional repayments while the fixed rate portion of a split loan is active.

Pros and cons of home loans with unlimited additional repayments

Positive

  • Shortened terms. If you are consistent in making additional repayments, you will be able to own your home outright sooner.
  • Save on interest. By making additional repayments, you are changing the base amount of the loan, thereby decreasing the amount of money you will have paid in interest fees over the length of your loan.
  • Redraw facility normally available. If you need to use the money that was used towards additional repayments, you can use the redraw facility to take a portion of it back.

Cons

  • Fees. Some banks will charge a fee for this service, or penalise you at the end of your loan with a high exit fee.
  • Limited loan type options. Most fixed rate loans will only allow a set amount of additional repayments to be made each year. By going over this amount you would be subjecting yourself to high fees and penalties. This makes this feature more adaptable to the variable rate home loan.

How extra repayments can see you pay your loan off sooner

Things to avoid

  • Exit fees. When investigating home loans that offer this feature, try and find those that are not charging any extra fees. You don’t want to be penalised for your hard work in paying off your home loan early.
  • No redraw. You will want to also ensure that there is a redraw option with this type of feature. This can allow you to have access to your money again in the event that an unexpected emergency arises.

Frequently asked questions

In most cases you are able to make your additional repayments at will, either by combining it with your normal repayment or by making large lump sum payments monthly.

In most cases no, but if yours is a fixed rate loan you will want to check if there really is not a limit on repayment amounts. Also compare exit fees to make sure you will not be charged substantially for an early payoff.

Marc Terrano

Marc Terrano is a Lead Publisher at finder. He's been writing and publishing personal finance content for over five years and loves to help Australians get a better deal.

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Important Information*
UBank UHomeLoan Variable Rate - Discount offer for Owner Occupiers, P&I Borrowing over $200,000

Take advantage of a low-fee mortgage with a special interest rate of just 3.59% p.a. and a 3.59% p.a. comparison rate.

loans.com.au Essentials - Variable (Owner Occupier, P&I)

A competitive interest rate home loan with interest only options. Interest rate 3.64% p.a.
comp rate of 3.66% p.a.

Tic:Toc Live in Loan Variable Rate - Principal & Interest

Get a very low interest rate and pay fewer fees. Enjoy a fast online application process and add a 100% offset account for $10 a month.

HSBC Home Value Loan - (Owner Occupier P&I)

Get a low interest rate loan with no ongoing fees. Plus you can make extra repayments and free redraw online. Available with just a 10% deposit.

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