2-year fixed rate home loans

How we calculate Home Loan Finder Scores

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What different scores mean

9+

Excellent

These home loans offer low costs, coupled with a host of features, giving the best overall value.

7+

Great

These home loans may have slightly higher interest rates or fewer features but overall, a competitive offering.

5+

Standard

Usually the home loans would offer above average rates. They may still include some competitive features.

0+

Basic

Higher costs and/or fewer features.

What are the benefits of a 2-year fixed rate home loan?

• Repayment certainty. The main reason borrowers fix is so they know their repayments won't change. This means you can budget accordingly.
• Forget about rate rises. In times of rapid rate rises, fixed rate borrowers don't need to worry. While it's true that fixed rate loans are typically higher than variable rates, not having to worry about a rate rise just makes life a little simpler.
• 2 years is a good sweet spot for many borrowers. How long you fix your rate depends on your goals and needs. For some borrowers, fixing for 1 year is simply not long enough. Fixing for a longer term like 4 or 5 years means a higher rate and less flexibility if you need to exit the loan. 2 years could be the perfect balance for some borrowers.

How do 2-year fixed rate home loans work?

A 2-year fixed rate home loan is like any other home loan: you borrow money and repay it over the loan term. The only difference is your interest rate won't move at all for the first 2 years of the loan.

After that, your loan reverts to a variable rate loan. Variable interest rate home loans can change at any time as lenders respond to changes in money markets and the overall economy.

Most lenders offer fixed rates between 1 and 5 years. Learn more about different fixed periods with these guides:

• 1-year fixed rate loans
• 3-year fixed rate loans
• 4-year fixed rate loans
• 5-year fixed rate loans

Are 2-year fixed rate loans higher than variable rate loans?

Because of the rate cuts we've seen in 2025, 2-year fixed rates have been lower than, or at least on par with, variable rates.

The average 2 year owner occupier fixed interest rate in December 2025 is 5.50%. The lowest is 4.64%.

The average owner occupier variable interest rate in December 2025 is 6.46%. The lowest is 4.99%.

Is it too late to lock in a low 2-year fixed rate?

You should consider fixing your rate if you want to forget about rate rises and enjoy knowing exactly how much you should budget on mortgage repayments each month.

But if you're trying to lock in the lowest rate on the market, that ship has sailed. If you want the lowest possible rate, you might be better off with a variable rate (even if rates are going to rise further).

You can see the current difference between fixed and variable rates on our average interest rates guide.

How do I compare 2-year fixed rate home loans?

To make sure you get a great deal on a 2-year fixed rate loan, pay attention to the rate, the fees and the loans' features.

Focus on the following:

Look for a lower rate

If you decide you want a 2-year fixed rate, compare your options to find a lower one. Why pay more interest for no reason?

Look for a loan with low fees

When some loans come with multiple fees and others almost none, a low-fee loan is a no-brainer.

A lower interest rate is more important, but low fees are another way to save on your loan costs.

Loan features

Fixed rate loans have fewer features than variable rate loans, like 100% offset accounts or the ability to make extra repayments. But some do, so it's worth comparing.

But even if a 2-year fixed rate lacks these features, you'll be on a variable rate in 24 months. Then the loan will give you more features and repayment options.

What kind of 2-year fixed rate home loans are available?

Owner-occupiers and investors both have plenty of options if they want to lock in a fixed rate.

Examples of specific fixed rate home loan types include:

• Fixed rate package home loans
• Fixed rate interest-only investor loans
• Low deposit fixed rate home loans
• Bad credit fixed rate home loans

More questions about fixing your home loan rate for 2 years?

• Can I make additional repayments?

  Fixed rate home loans usually put limitations on how many additional repayments you can make each year. If you plan on making additional repayments often you may want to choose another type of loan.

• Is now a good time to fix?

  If you want to fix your rate purely so you know what your repayments are each month, there's never a bad time to fix. But fixing to lock in the lowest rate possible is a much harder task.

  In November 2025, economists largely predicted there would be more rate cuts in 2026, but then new data was released which sent everyone predicting the opposite. It might be a good time to fix, but you can never know for certain.

• How do I know when interest rates are going to rise?

  It's hard for the average person to understand interest rate moves. Lenders and banks are largely free to set their own rates on home loans, but they are guided by the broader economy and how easy (and cheap) it is for them to borrow the money to fund home loans.

  The RBA also plays a big role. The bank sets the official cash rate, which sets a benchmark for the cost of institutions to lend and borrow money. When the cash rate goes up, lenders raise variable interest rates for borrowers. But they also start to raise fixed rate loans for new customers.

  Follow Finder's monthly cash rate predictions to find out where the experts think rates are heading.

• What's a split rate home loan?

  A split rate loan allows you to divide your loan into fixed and variable rate portions. This means you can lock in 50% of your loan for 2 years and have the remaining 50% on a variable rate.

  A split rate lets you have the best of both worlds and is a way of hedging your bets if you're concerned about rate rises but still want the extra features and repayment options on a variable rate loan.

What is Finder Score?

The Finder Score crunches 7,000 home loans across 120+ lenders. It takes into account the product's interest rate, fees and features, as well as the type of loan eg investor, variable, fixed rate - this gives you a simple score out of 10.

To provide a Score, we compare like-for-like loans. So if you're comparing the best home loans for cashback, you can see how each home loan stacks up against other home loans with the same borrower type, rate type and repayment type. We also take into consideration the amount of cashback offered when calculating the Score so you can tell if it's really worth it.

Read the full breakdown

To make sure you get accurate and helpful information, this guide has been edited by Jason Loewenthal as part of our fact-checking process.

Written by

Richard Whitten

Senior Money Editor

Richard Whitten is Finder’s Senior Money Editor, with over eight years of experience in home loans, property, credit cards and personal finance. His insights appear in top media outlets like Yahoo Finance, Money Magazine, and the Herald Sun, and he frequently offers expert commentary on television and radio, helping Australians navigate mortgages and property ownership. Richard started his career in education and textbook publishing in South Korea. He holds multiple industry certifications, including a Certificate IV in Mortgage Broking (RG 206) and Tier 1 and Tier 2 certifications (RG 146), as well as a Bachelor of Education from the University of Sydney and a Graduate Certificate in Communications from Deakin University. See full bio

Richard's expertise

Richard has written 677 Finder guides across topics including:

• Home loans
• Credit cards
• Personal finance
• Money-saving tips