Fixed Rate Home Loans
Fixed home loan rates offer greater certainty because you lock in your repayments for a set period.
Virgin Money Home Loan Offer
Apply for the Virgin Reward Me Fixed Rate Home Loan - 2 Year $300k+ Special offer (Owner Occupier, P&I) and get a low interest rate with no application fee as well as a 100% offset account.
- Interest rate of 2.89% p.a.
- Comparison rate of 3.31% p.a.
- Application fee of $0
- Maximum LVR: 80%
- Minimum borrowing: $300,000
Compare the latest fixed rate home loans below
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The interest rate is the most important part of a mortgage. It determines how much interest you have to pay every month. The lower the interest rate, the better.
A fixed interest rate mortgage allows you to lock in a certain interest rate for a specified period (usually between 1 and 5 years). During the fixed period your rate will not rise. But it won't fall either.
The benefit to you is certainty. Your rate might be slightly higher than a competitive variable rate but you know exactly what your repayments will be. This lets you budget accurately and offers some peace of mind.
Fast facts: fixed rates
- A fixed interest rate is typically higher than a variable rate, although many competitive offers are just as low now.
- A fixed rate mortgage is less flexible. You might not be able to make extra repayments and there may be higher costs for leaving the mortgage (to refinance). Always read the fine print.
- Once the fixed rate period ends you will go onto a variable rate. This is a really good time to look around and see if you can refinance to a better deal somewhere else.
Should I go for fixed or variable?
Let's weigh the positives and negatives of fixed rates in more detail.
- Repayment certainty. A fixed-rate home loan offers you peace of mind in knowing what your repayments will be. This allows you to budget more effectively.
- Security. With a fixed-rate home loan you are protected from interest rate rises as your interest rate is locked in for the specified term. If rates rise, you come out ahead.
- Flexible loan terms. Fixed-rate mortgages are available from many Australian lenders with a variety of fixed loan terms available.
- Low rate offers. Many lenders now offer very competitive fixed rates that are almost as low as competitive variable offers (and in some cases identical).
- Limited features. Fixed rate loans don't have a lot of flexibility compared to variable rate mortgages. Most lenders don’t offer fixed home loans with 100% redraw facilities or 100% offset accounts.
- Break costs. If you decide to break out of a fixed rate loan before the end of the specified term, you may face a break cost. This can cost a few hundred dollars, or potentially thousands. Read this guide to learn more about breaking a fixed rate loan.
- Rates could drop. If the RBA slashes the cash rate you could end up with a higher rate compared to variable home loans on the market.
In short, if you value certainty over flexibility then a fixed rate could be for you. If you care about extra repayments and mortgage features you might be better off with a variable rate.
Learn more about the benefits and drawbacks of fixed and variable rate loans and use our switching costs calculator to help you calculate whether refinancing your loan now will end up saving or costing you money.
More fixed rate questions answered
Home Loan OffersImportant Information*
Take advantage of a low-fee mortgage with a special interest rate of just 2.84% p.a. and a 2.84% p.a. comparison rate.
Owner occupiers looking to refinance can get one of the lowest rates in the market with this variable rate mortgage. $0 application fee and $0 ongoing fees. Refinancers only.
Buy your home and lock in a low rate for the first two years. Available with a 10% deposit. Earn Velocity Frequent Flyer Points at settlement, monthly and every three years, plus extra bonus points for a limited time.
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