Home Loans From 2.50%


Compare Popular Home Loans

Advertised rate
Comparison rate*
Monthly repayment
Real Time Rating™
Go To Site

Learn more about home loans

Whether you're wondering how to get a home loan, or just comparing mortgage interest rates, you can get the home loan facts you need to make a smarter financial decision at RateCity.

How much do I need to borrow?

It's important to ask yourself 'how much can I borrow?' during the early stages of your search for a mortgage. Whether you're looking for your first home loan, or refinancing an existing mortgage, it's important to know exactly where your finances stand before approaching a lender.

Everyone has a different financial situation, which is why there's no such thing as a one-size-fits-all home loan. You will need to weigh up your individual circumstances and select a home loan that's suitable for your needs.

A good place to start is the RateCity mortgage calculator. Just enter a few figures and it will give you an idea of what your first home loan repayments may be, as well as a list of lenders offering mortgages that might be right for you.

How long can you pay a home loan for?

The standard amount of time to pay a home loan for is 30 years. However, there are other options. For example, some lenders will allow certain borrowers to pay off their home loan over 40 years. Some borrowers, who want to pay pay off their mortgage faster, might ask for a loan term of 25 years or 20 years.

Also, when people refinance, they often make the loan term of their new mortgage the same as the remaining loan term of their existing mortgage. For example, if they had originally decided to pay their home loan for 30 years, and they then refinanced after seven years, they would choose a 23-year loan term for their new mortgage rather than a 30-year loan term.

There are advantages and disadvantages whether you choose to pay a home loan over a shorter term or a longer term. A shorter loan term means higher monthly repayments but lower total repayments over the life of the loan, while a longer loan term means lower monthly repayments but higher total repayments.

How big does my home loan deposit need to be?

The size of your deposit will likely play an important part when you’re choosing a home loan. When working out how much money you need for a house deposit, keep in mind that the more money you can put down on a property upfront, the more likely a lender will offer you an affordable interest rate.

Many home loans require a deposit of around 20% of the property's value, though there are options available with 10% or even 5% deposits. Keep in mind that low-deposit home loans often require you to pay for Lenders Mortgage Insurance (LMI).

Remember to use home loan comparison tools to help you determine which home loan rates will likely suit your household budget before you apply for a mortgage.

What is Lender's Mortgage Insurance?

Lenders Mortgage Insurance (LMI) is an insurance policy that many lenders require if a borrower has less than a 20% deposit on their mortgage, and thus is considered to be at relatively high risk of defaulting on their loan.

It's important to remember that LMI does not protect a borrower if they're unable to afford their mortgage - LMI only covers the lender's financial risk, and helps to limit their losses if a borrower fails to keep up with their home loan payments.

LMI can add thousands of dollars to the upfront cost of a home loan, so it's often worth considering when estimating whether you can afford a mortgage.

What happens if you miss a home loan payment?

If you miss a home loan payment, two things are likely to happen:

  • You’ll be hit with a penalty fee
  • Your lender will contact you to ask for an explanation and to request that you immediately make the home loan payment

Most lenders understand that people sometimes miss home loan payments, so if you immediately fix the problem, that will probably be the last you hear of it.

However, if you don’t immediately make the last home loan payment, and if you then miss the next one, the problem will probably escalate. The lender might now start having doubts about your ability to repay the mortgage and keep a close eye on your file.

If you keep missing home loan payments, the lender might conclude that your behaviour will never change. In that case, the lender might decide that the only way to get its money back is to foreclose on the mortgage - that means seizing and selling your home.

Foreclosure is generally a last resort. Lenders don’t like to take this option, so they are highly unlikely to seize your home just because you miss one home loan payment. That said, the moment you miss a home loan payment, you risk suffering serious consequences.

Why should you compare home loans?

Are you in the market for your first home loan? Do you want to know if you're getting a competitive deal on your current home loan? Curious about the cheapest home loan rates available across the industry? Want to find out which bank has lowest interest rate for a home loan that suits your needs? You'll want to consider making a home loan comparison.


Some benefits of using RateCity for your home loan comparison include:

Which home loan should you choose?

The only person who can decide what is the best home loan for your needs is you. Industry experts can provide facts and figures to help you make a home loan comparison, but the final decision rests with you.

You might be applying for your first home loan or moving up the property ladder. In either situation, it's important to understand the short and long-term financial effects of your decision, and to select a home loan that most accurately reflects your requirements.

Researching options that match your specific needs are necessary. Remember that you're looking for the best home loan to match your needs. While it might not seem obvious, the cheapest home loan rates may not actually be the best rates for your needs, making home loan comparison an integral part of the home loan journey.

It’s important to find the right mortgage for you, so you can rest assured that you have made the right decision, and that you're able to confidently save money in the long term, thanks to affordable home loan rates.

RateCity's Mortgage Guide provides tips and useful information on what to consider when applying for a mortgage. Whether you want to know about how mortgage repayments are calculated, the fees involved with getting a mortgage, or the different features available with some home loans, you are in the right place.

Should I use a mortgage broker?

With so many home loans out there to compare, it can sometimes feel impossible to narrow down your options. This is where a mortgage broker can prove invaluable.

A broker can carry out a home loan comparison on your behalf and present a range of different options, with home loan rates that may suit your budget. This way, you can get a better idea of what home loan products are available, and how much you’ll have to borrow.

Financial Dictionary

AAPR, Comparison Rate or Real Rate Three ways of saying the same thing. The Average Annual Percentage Rate (AAPR), Comparison Rate and the Real Rate refer to interest rates plus fees and charges rolled into a single percentage rate for ease of comparison
Break cost Fees charged by your lender if you exit your loan early, most often applied if you have a fixed interest rate
Bridging Finance Helps you to “bridge” the gap between the sale of one property and the purchase of another.
Capped or Tunnel Loans Capped loans limit how high your loan’s variable interest rate can go, while Tunnel loans limit both how high and low a rate can go.
Conveyancing Conveyancing is the process of transferring legal ownership of a property from one party to another. Legal fees on a property purchase are called conveyancing fees.
Deposit The amount of cash you need to contribute towards your home loan application.
Fixed Rate Loan A mortgage with interest rates that are locked in for a certain period of time.
Interest Capitalisation An option to add interest charges to your total loan balance for a limited time, rather than paying it as you go.
Introductory or Honeymoon Rate Loan A mortgage offering a discounted interest rate for an initial introductory period (the “honeymoon”), before reverting to the higher standard rate.
Lenders Mortgage Insurance LMI safeguards the lender in case a borrower defaults on their mortgage. LMI is typically required for mortgages with an LVR higher than 80% (or a deposit of less than 20%), with the borrower required to pay the cost.
Loan to Value Ratio (LVR) The size of your home loan compared to the value of your property. For example, if you paid a 20% deposit on a property, and took out a mortgage for the remainder of its value, you’d have an LVR of 80%.
Mortgage Offset A saving or transaction account linked to your home loan, which included when calculating interest charges. For example, if you had a $300,000 home loan and a 100% offset account holding $20,000, you’d be charged interest as if you only owed $280,000 on your mortgage.
Overdraft A line of credit, typically secured by the equity in your property, allowing you to borrow extra funds if required.
Parental Leave A type of repayment holiday offered by some lenders when you become a parent
Portability An option to pick up your loan and take it with you when you move houses.
Redraw Pay extra money into your loan and withdraw it back if you need it in the future.
Refinancing Taking out a new loan to pay out an old one. Refinancing may allow a borrower to enjoy more favourable interest rates, fees, features or benefits.
Repayment Holiday An option to take a temporary “holiday” from loan repayments when you experience proven hardship, such as an unexpected loss of income.
Revolving Line of Credit Essentially a giant overdraft, where money can be borrowed, repaid, then withdrawn again.
Salary Loan A mortgage where your payments can come directly out of pre-tax income from your employer as a salary sacrifice, which can have tax benefits.
Split Loans A home loan where interest is charged on part of your balance at a fixed rate, and part of your balance at a variable rate, providing you with a mix of security and flexibility.
Stamp Duty Stamp Duty is a State Government tax on the sale and transfer of land and property
Switching Fees The costs and charges involved when refinancing your home loan from one lender to another
Upfront Fees Fees charged at the start of your home loan to help cover the cost of processing your application
Variable Rate Loan A home loan where the lender may raise or lower your interest rate depending on a range of economic factors, including the national cash rate set by the Reserve Bank of Australia.

Sally is the Research Director for RateCity. Passionate about helping everyday Australians save money through smart budgeting and get access to affordable finance options without falling victim to marketing ploys, she's contributes to news outlets from Fairfax and News, and a regular commentator on television and radio about personal finance matters.

Popular Home Loan Lenders


Each lender has its own policies, but as a general rule you will have to pay lender’s mortgage insurance (LMI) if your loan-to-value ratio (LVR) exceeds 80 per cent. This applies whether you’re taking out a new home loan or you’re refinancing.

If you’re looking to buy a property, you can use this LMI calculator to work out how much you’re likely to be charged in LMI.



As seen on