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Current interest rates in Australia
Currently the average variable home loan interest rate in Finder's database is 3.95% but you can find variable rates as low as 1.99% at Finder. Is it time to switch?
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What does a competitive interest rate look like in the current home loan market? It's probably lower than you think. In the table below you can compare the current average interest rates for fixed and variable loans according to Finder's database. We also list the lowest rate offer currently available through Finder.
If you just want to see the cheapest loans, check out our lowest home loan rates page.
Average interest rates versus the lowest rates*
| Rates December 2020 | Data |
|---|---|
| Average variable mortgage interest rate | 3.95% |
| Lowest variable rate available on Finder | 1.99% |
| Average 3-year fixed mortgage interest rate | 2.96% |
| Lowest 3-year fixed rate available on Finder | 1.95% |
*Rates are averages taken from all comparable loans in Finder's database, which covers a large portion of the Australian mortgage market. Lowest rates listed above are based on products from lenders with whom Finder has a commercial partnership.
Borrowers can save a lot of money with a below average interest rate
Home loan rates are very low right now. This is because the Reserve Bank has made multiple cuts to the official cash rate, bringing it down to a historic low. This has driven down lenders' funding costs, which they pass on to new borrowers in the form of lower rates.
But borrowers who already have a home loan are probably missing out. Many lenders offer very low rates for new customers while keeping their loyal, existing customers on older, higher rates.
You can ask your lender to put you on a more competitive rate. And if that doesn't work then compare and refinance your home loan to get a better deal.
Here are some current Australian mortgage rates
While there are some rates on the market that may be lower, Finder lets you compare a range of competitive rates from lenders large and small. And if you can't find what you're looking for or just need more help, you can also speak to a mortgage broker.
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.
The Adviser’s number 1 placed mortgage broker 8 years running (2013-2020)
More information about Australian mortgage rates
There are two graphs below. The first one tracks the average monthly rates according to an analysis of Finder's database. The second graph shows the lowest rate on the market each month. It's a helpful way to just how much you can save by comparing interest rates.
Check out more detailed mortgage data on our home loans statistics page
How much difference does a higher or lower interest rate make?
When you borrow money to finance the purchase of a home, banks don't just hand the funds out for free. Not only will you have to pay back the money you borrow, but you'll also have to repay the interest that accumulates on that principal amount.
When comparing home loans, checking out the current average home loan interest rate on this page gives you a quick and easy way to compare rates for different mortgages on the market at any given time.
Even a slight variation in interest rates can make thousands of dollars of difference over the life of a home loan. For example, let’s consider a $500,000 home loan with principal and interest repayments and a loan term of 30 years. The table below shows the overall cost of this loan with an interest rate of 2.75% p.a. and 3.00% p.a.
| Loan A | Loan B | |
|---|---|---|
| Interest rate | 3.00% p.a. | 2.75% p.a. |
| Loan amount | $500,000 | $500,000 |
| Monthly repayment amount | $2,108.02 | $2,041.21 |
| Total cost of loan | $758,887.26 | $734,834.13 |
| Total interest paid | $258,887.26 | $234,834.13 |
As you can see, the 0.25% p.a. lower interest rate of Loan B results in a saving of more than $24,000 across the 30-year loan term. That clearly demonstrates just how important it is to get a competitive interest rate. Use our home loan repayment calculator to see how a higher or lower interest rate could affect your mortgage repayments.
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Important Information*
Ask an Expert
Hi, I have a mortgage of $90,000 remaining could I change to another bank with this amount. I have a variable interest rate and receive a discount of 1.12% my rate being 4.15%. I would like to transfer to a bank with a more competitive rate.
Thank you.
Hi Allan,
Thanks for your inquiry.
Yes, you can change your mortgage to get better rates by doing a refinance home loan and you may refer to this page to get started. On the page you’ll find:
– a table that lists out the brands offering refinancing
– benefits of refinancing
– steps on refinancing
– average costs
– other refinancing FAQs
To get started comparing, enter the information needed on the three fields provided and click calculate. It will show the providers based on what you are filtering out (on the black bar). A mortgage broker is the best person to reach out to see your options for refinancing. They can give you a multitude of options according to your situation. In the meantime, to give you an estimate of your monthly repayments, you may use the calculator we have on this page.
Hope this helps!
Best,
Nikki