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Split home loans

A split home loan lets you divide your mortgage into separate fixed and variable parts, giving you some variable flexibility and fixed rate stability.

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A home loan usually has either a fixed rate or a variable rate. But a split home loan allows you to have a bit of both. Here's how a loan split works: Say you borrow $500,000, you can lock 40% of it ($200,000) at a low fixed rate for 3 years and the remaining 60% ($300,000) is on a variable rate. If rates rise, 40% of your loan is fixed. If rates fall, 60% of your loan should benefit from lower rates.

Compare home loans with rate split options

1 - 3 of 3
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years
Name Product Interest Rate (p.a.) Comp. Rate p.a. Fees Monthly Payment

HSBC Home Value Loan P&IHome≥ 30% Deposit

HSBC Home Value Loan
2.77%
2.78%
  • App: $0
  • Ongoing: $0 p.a.
$616
$3,288 refinance cashback offer
This competitive variable rate loan is available for borrowers with 30% deposits. Eligible refinancers borrowing $250,000 or more can get a $3,288 cashback. Terms and conditions apply.

Speak to a broker about your options

HSBC Home Value Loan P&IHome≥ 10% Deposit

HSBC Home Value Loan
2.87%
2.88%
  • App: $0
  • Ongoing: $0 p.a.
$624
$3,288 refinance cashback offer
A competitive value home loan with no ongoing fee. Eligible refinancers borrowing $250,000 or more can get a $3,288 cashback. Terms and conditions apply.

Speak to a broker about your options

Newcastle Permanent Building Society Premium Plus Package Home Loan P&IHome≥ 20% Deposit

Newcastle Permanent Building Society Premium Plus Package Home Loan
3.44%
3.83%
  • App: $0
  • Ongoing: $395 p.a.
$670
Get up to $3,000 refinance cashback when your LVR is 90% or lower ($2,000 cashback for loan amounts of $250K+ and above, $3,000 for $500K+). Other conditions apply. New borrowers or refinancers can get a discounted rate with this package loan.

Speak to a broker about your options

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Aussie Home Loans Logo

Enter your details and get a free consultation with an expert broker from Aussie.

By submitting this form, you agree to the Finder Privacy and Cookies Policy and Terms of Use

Applications are subject to approval. Conditions, fees and charges apply. Please note that you need to be an Australian citizen or permanent resident to apply.

Credit services for Aussie Select, Aussie Activate and Aussie Elevate products are provided by AHL Investments Pty Ltd ACN 105 265 861 (“Aussie”) and its appointed credit representatives, Australian Credit Licence 246786. Credit for Aussie Select products is provided by Residential Mortgage Group Pty Ltd ACN 152 378 133, Australian Credit Licence 414133 (“RMG”). RMG is a wholly-owned subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian Credit Licence 234945. Credit for Aussie Activate products is provided by Pepper Finance Corporation Limited ACN 094 317 647 (“Pepper”). Pepper Group Limited ACN 094 317 665, Australian Credit Licence 286655 acts on behalf of Pepper. Credit services for Aussie Elevate products are provided by AHL Investments Pty Ltd ACN 105 265 861 Australian Credit Licence 246786 (“Aussie”) and its appointed credit representatives. Aussie is a trade mark of AHL Investments Pty Ltd ABN 27 105 265 861. Credit and any applicable offset accounts for Aussie Elevate are issued by Bendigo and Adelaide Bank Limited ABN 11 068 049 178 AFSL / Australian Credit Licence 237879.

Aussie is a trade mark of AHL Investments Pty Ltd. Aussie is a subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124. ©2020 AHL Investments Pty Ltd ABN 27 105 265 861 Australian Credit Licence 246786.

By submitting this form, you agree to the Aussie privacy policy.

After entering your details a mortgage broker from Aussie will call you. They will discuss your situation and help you find a suitable loan.

  • A comparison of home loans from multiple lenders.
  • Expert guidance through the entire application process.
  • Free suburb and property reports.

Aussie Home Loans Lender Logos

The Adviser’s number 1 placed mortgage broker 8 years running (2013-2020)

What is a split rate home loan?

A home loan split means dividing portions of your home loan principal (the money you have borrowed) into different home loan accounts with different interest rate types. You could split your loan 50/50 between a fixed rate and a variable rate, or you could split it 80/20 and so on. Some lenders allow you to split multiple times.

Split rate home loans allow you to enjoy some benefits of both fixed and variable rates. If your lender cuts rates, your variable portion will drop. But if rates rise, the fixed portion of your mortgage split will still be at the lower rate (because fixed rates don't change).

Example: Catherine goes for a split loan

Split home loans case study 2 Catherine is discussing her split loan options with her lender. She needs to borrow $300,000 and wants both repayment certainty but the ability to make additional repayments and put funds into a 100% offset account.

Catherine decides to split her loan 50/50, putting $150,000 into a 3-year fixed rate account and $150,000 into a variable rate that has an offset account. She also puts $50,000 of her savings into the offset account, reducing her variable loan principal to $100,000.
* This is a fictional, but realistic, example.

Fixed versus variable rates: What's the difference?

Split loan calculator

You can use our split loan calculator to estimate the costs and benefits of splitting your rate. Put your full loan amount in the second field, and specify the fixed portion in the "fixed portion of loan" field. Note that this calculator doesn't allow you to estimate more than 2 splits.

If you don't have the exact numbers, use the closest estimates you can come up with.

How do I split my home loan?

The process for splitting a loan is relatively simple, although you can do very complicated splits with the aid of a split calculator or a broker.

  1. Find a loan with a split facility. Not all mortgages have the option to split your loan. Check if yours does and if it doesn't, ask your lender if they can make an exception or consider refinancing to a loan that allows splits.
  2. Decide your split portions. You can split any way you like depending on how you wish to structure your loan. You could split 50/50 or into more than 2 portions (most lenders allow up to 6 splits).
  3. Make repayments. Once your loan is split you make repayments into each portion as normal. If your variable portion allows for extra repayments you could pay off extra in order to pay off your loan faster.
  4. Monitor your rates. The fixed rate portion won't change during the fixed period. But your variable portion can change at any time, so be sure to monitor the rate. If it gets too high you might want to refinance. Just keep in mind that there are breaking costs associated with ending a fixed rate, which could be costly.

Why should I split my rate?

  • Certainty and flexibility. A split rate loan can give you the certainty that a portion of your loan won't be impacted should interest rates rise, but the flexibility to benefit from any rate reductions and some of the features commonly offered on variable rate loans.
  • Repayment certainty. A fixed rate locks in a rate for an agreed period of time. During this fixed term, your rate, and therefore your repayments, won't change at all. This can give borrowers who are trying to keep to a strict budget more security, and can minimise the impact of rate increases.
  • Offset accounts and extra repayments. If the variable portion of your loan allows for extra repayments or has an offset account you can use extra cash to reduce your home loan debt faster.
  • More options. A split facility gives you more options with your mortgage, allowing you to fine tune your splits for maximum effect.

How can a broker help?

A good mortgage broker can help you design a mortgage split that works for you. This can be very helpful because calculating these splits and understanding the benefits can be confusing for the average borrower. A broker's service is usually free because they receive a commission from the lender, not the borrower.

Aussie Home Loans Logo

Enter your details and get a free consultation with an expert broker from Aussie.

By submitting this form, you agree to the Finder Privacy and Cookies Policy and Terms of Use

Applications are subject to approval. Conditions, fees and charges apply. Please note that you need to be an Australian citizen or permanent resident to apply.

Credit services for Aussie Select, Aussie Activate and Aussie Elevate products are provided by AHL Investments Pty Ltd ACN 105 265 861 (“Aussie”) and its appointed credit representatives, Australian Credit Licence 246786. Credit for Aussie Select products is provided by Residential Mortgage Group Pty Ltd ACN 152 378 133, Australian Credit Licence 414133 (“RMG”). RMG is a wholly-owned subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian Credit Licence 234945. Credit for Aussie Activate products is provided by Pepper Finance Corporation Limited ACN 094 317 647 (“Pepper”). Pepper Group Limited ACN 094 317 665, Australian Credit Licence 286655 acts on behalf of Pepper. Credit services for Aussie Elevate products are provided by AHL Investments Pty Ltd ACN 105 265 861 Australian Credit Licence 246786 (“Aussie”) and its appointed credit representatives. Aussie is a trade mark of AHL Investments Pty Ltd ABN 27 105 265 861. Credit and any applicable offset accounts for Aussie Elevate are issued by Bendigo and Adelaide Bank Limited ABN 11 068 049 178 AFSL / Australian Credit Licence 237879.

Aussie is a trade mark of AHL Investments Pty Ltd. Aussie is a subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124. ©2020 AHL Investments Pty Ltd ABN 27 105 265 861 Australian Credit Licence 246786.

By submitting this form, you agree to the Aussie privacy policy.

After entering your details a mortgage broker from Aussie will call you. They will discuss your situation and help you find a suitable loan.

  • A comparison of home loans from multiple lenders.
  • Expert guidance through the entire application process.
  • Free suburb and property reports.

Aussie Home Loans Lender Logos

The Adviser’s number 1 placed mortgage broker 8 years running (2013-2020)

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4 Responses

  1. Default Gravatar
    DianeSeptember 8, 2017

    Continuing, there might not be enough collateral to make up the 80% that we need to refinance as the interest loan runs out and ends in 5 months and as I said there might not enough , have you got any suggestions, we could rent the investment house as it stands empty, we just didn’t have to , I guess, Diane

    • Default Gravatar
      JonathanSeptember 8, 2017

      Hello Diane,

      Thank you for providing these additional details.

      If you’re unable to come up with 80%, your nearest option is to use the equity available in your family home to borrow up to 100%. You can check about line of credit equity loans and the list of lenders available.

      Alternatively, if you’re uncomfortable with tapping your home equity, you may proceed with refinancing deals that offer low-deposit home loans. You can use the calculator located at the top of the comparison table to get an estimate of your repayments.

      Hope this helps.

      Cheers,
      Jonathan

  2. Default Gravatar
    DianeSeptember 8, 2017

    We have 2 houses ,one that we live in paid $ 364,000 in 2009 and the other an investment house,paid $364.000, almost 5 years ago. Also, we have interest loan only, it expires in 5 months, there has been a down turn and both house together are valued at $370,000. We have a business, Bank said they don’t chattels for loans, help.

    • Default Gravatar
      JonathanSeptember 8, 2017

      Hello Diane,

      Thanks for reaching out to Finder.

      Lenders have different criteria when it comes to properties that can be accepted as security for a home loan. The general rule is the easier a property is to sell and the higher the demand for that particular type of property, the better the chances of a lender accepting it as loan security.

      You may consider getting a low doc home loan. These can be useful for business owners. Once you have selected a particular lender, you may have to directly get in touch with them to discuss the eligibility of your property as security. When you are ready, you may then click on the “Enquire now” button. If you submit your details via the form on the page, a mortgage broker will be in touch to discuss the different options available and provide you with a quote.

      Before applying, please ensure that you meet all the eligibility criteria and read through the details of the needed requirements as well as the relevant Product Disclosure Statements/Terms and Conditions when comparing your options before making a decision on whether it is right for you. You can also contact the provider if you have specific questions.

      Hope this helps.

      Cheers,
      Jonathan

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