Home loan cashback offers

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 is a home loan cashback offer?

A home loan cashback is a lump-sum payment a lender gives to a borrower as an incentive to take out a mortgage with them. Cashbacks are typically worth between $1,000 and $4,000.

Lenders use these offers to attract new customers, particularly those looking to refinance an existing home loan from a competitor. However, some cashback deals are also available for first home buyers and those purchasing a new property.

How do home loan cashbacks work?

Once your loan is approved and settled, the lender deposits the cashback amount directly into your transaction or offset account. The funds are not considered taxable income and you are free to use the money however you like.

Cashbacks can have some conditions attached that borrowers need to meet, like:

• Minimum loan amount. Most cashback offers apply for loans of $250,000 and above.
• Apply before the deadline. Cashbacks are usually offered for a limited time, with strict deadlines for application and settlement.
• Loan-to-value ratio (LVR). You may not be eligible if your LVR is above 80%, meaning you need a deposit of at least 20%.
• Loan purpose. Some cashback offers are limited to refinancers, or are specific to homebuyers only (and not investors).

The time it takes to receive your payment varies between lenders, but you can typically expect the money in your account within 30 to 120 days after settlement.

Which lenders have home loan cashback deals right now?

Right now there are 13 home loan cashbacks on offer in Australia, plus several more in the form of Qantas Points offers or gift cards (including a Finder Reward with Unloan).

*Reduce does offer a $10,000 cashback but only if your loan is over $2 million.

Other special home loan offers

• BankWAW is offering a $2,000 gift card for borrowers who refinance to a Flexible Choice loan.
• Commonwealth Bank is offering Qantas Points to borrowers who take out a Digi Home Loan of $300,000 or more. Borrowers can get between 100,000 and 300,000 Qantas Points. Those points are worth thousands of dollars or more depending on how you redeem them.

Is a home loan cashback offer worth it?

A cashback offer can be a great perk, but it shouldn't be the main reason you choose a loan. The long-term cost of the mortgage is far more important than a one-off bonus. A loan with a slightly higher interest rate can cost you tens of thousands of dollars more over time, quickly wiping out the benefit of a few thousand dollars in cashback.

Before committing, ask yourself: if the cashback offer was removed, would this still be the right loan for me?

Always compare the following features to ensure the loan is a good deal on its own:

• Interest rate. Does this loan have a competitive interest rate, in line with the other cheapest rates in the market? Will it save you money even without the sign-up bonus?
• Comparison rate. This rate includes most upfront and ongoing fees, giving you a better indication of the loan's true cost.
• Fees. Check for application fees, ongoing annual or monthly fees, and discharge fees.
• Fine print. If the loan offers a special lower interest rate, is that just for the first year, or ongoing? Will the loan revert to a higher rate?
• Loan features. The sign-up offer should not be the only reason you choose a certain home loan. Does the loan have an offset account or redraw facility?

Expert insight: The risks of cashbacks

"Cashbacks were initially offered to cover the switching costs associated with refinancing. Whilst these are a great offer, it shouldn't be the sole reason to refinance your loan or pick a product provider.
When we assess the suitability of a lender, we take into account your circumstances and match the right lending policy before anything else – then it is rates and fees and finally we look at cashback opportunities. We have seen many clients get into the wrong products because they were lured by a $2,000 sugar hit. These products can end up being tens of thousands of dollars more expensive in the long run."

Matt Turner

Mortgage broker, GSC Finance Solutions

When a cashback offer doesn't make sense

Here's an example of how a cashback offer can be misleading:

Imagine you're refinancing a $500,000 loan. You have two options:

• Loan A: Offers a $3,000 cashback with a 6.10% p.a. interest rate and a $395 annual fee.
• Loan B: Has no cashback, a 5.95% p.a. interest rate and no annual fee.

With Loan A, you get an immediate $3,000 boost. However, after just five years, you will have paid $1,975 in annual fees and approximately $5,500 more in interest compared to Loan B. The initial cashback has been completely erased by higher costs.

What other kind of special offers do lenders provide?

Fee reduction or waived fees

A lender might waive the application fee, which can be a saving of $600 or more.

Discounted interest rates

Some loans offer a low introductory or 'honeymoon' rate for the first year or two. Be sure to check what the rate reverts to after the discount period ends.

Package deals

Lenders may bundle a home loan with other products like a credit card and transaction account for a single annual fee. This can offer value if you use all the products included.

Frequent flyer points

Some home loans let you earn frequent flyer points on your loan balance, though these loans often come with higher rates or fees.

Expert insight: Can you still get cashbacks?

"Cashback offers are still available and can provide a financial boost during the settlement process. However, it's important to weigh the overall loan cost and terms, as cashback deals sometimes come with higher interest rates or fees. Always compare the long-term savings against the upfront reward."

Brett Sutton

Mortgage broker, Two Red Shoes

Frequently asked questions about home loan cashback offers

• Can you get a cashback when you refinance?

  Yes. In fact, most home loan cashback offers are specifically targeted at borrowers who are refinancing from another lender.

• Can you get a cashback as a first home buyer?

  Yes. While many deals are for refinancers, some lenders have specific cashback offers for first home buyers or general offers that are open to anyone purchasing a property.

• What are the disadvantages of cash back?

  The main disadvantage is that the offer can distract you from a loan's long-term costs. A loan with a high interest rate or expensive fees can quickly outweigh the benefit of the cashback. Always ensure the loan itself is competitive.

• Can I get a cashback as a homebuyer?

  Yes. While most cashbacks are for refinancers, many current offers include purchasers as well (people buying a home who need a new loan). There are some cashbacks that are only for first home buyers.

• Is it worth refinancing frequently to get multiple cashbacks?

  This is generally not a good strategy. Refinancing comes with costs, such as discharge and mortgage registration fees, which can reduce your net gain. Lenders also include clawback clauses that require you to repay the cashback if you leave within one or two years. Finally, restarting your loan term every time you refinance can mean you pay more interest overall.

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 Rebecca Pike and reviewed by John Pidgeon, a member of Finder's Editorial Review Board.

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 718 Finder guides across topics including:

• Home loans
• Credit cards
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• Money-saving tips