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The best home loan interest rates in Australia
Every month, Canstar updates the list of the top-rated home loans on its database. If you’re on the hunt for the best home loans in Australia, this could be the place to start.
24 Apr 2024
Every month, Canstar updates the list of the top-rated home loans on its database. If you’re on the hunt for the best home loans in Australia, this could be the place to start.
If you’re on the hunt for a home loan, whether it’s to purchase new or refinance, Canstar’s Star Rating could be a great place to start. When comparing home loans to find the ideal one for you in your circumstances, it pays to consider your situation and compare loans based on interest rates, fees and features.
Canstar also gives annual awards to recognise banks and other kinds of lenders offering outstanding value overall, both in home loans as a whole and to certain groups of borrowers such as first home buyers and investors. Like our product-based Star Ratings, Canstar’s Outstanding Value Awards can help borrowers narrow down their options when looking for the best loan for them.
Compare Home Loans (Refinance with variable rate only) with Canstar
If you’re currently considering a home loan, the comparison table below displays some of the variable rate home loans on our database with links to lenders’ websites that are available for homeowners looking to refinance. This table is sorted by Star Rating (highest to lowest), followed by comparison rate (lowest to highest). Products shown are principal and interest home loans available for a loan amount of $500,000 in NSW with an LVR of 80% of the property value. Consider the Target Market Determination (TMD) before making a purchase decision. Contact the product issuer directly for a copy of the TMD. Use Canstar’s home loans comparison selector to view a wider range of home loan products. Canstar may earn a fee for referrals.
Owner occupied
20% min deposit
Redraw facility
Owner occupied
20% min deposit
Redraw facility
Owner occupied
10% min deposit
Redraw facility
Owner occupied
20% min deposit
Redraw facility
Owner occupied
10% min deposit
Redraw facility
Best fixed rate home loans
If you’re looking for a top-rated loan that allows you to lock in your interest rate for a set period, you can use Canstar’s Home Loans comparison tool to show some of the 5-Star Rated fixed rate products on our database with the lowest comparison rates at the time of writing. Read our Star Ratings methodology for more details on how the top-rated products were identified.
Best variable rate home loans
If you want the added flexibility that a variable rate home loan can offer, you can use Canstar’s Home Loans comparison tool to show some of the 5-Star Rated variable rate products on our database with the lowest comparison rates at the time of writing. Read our Star Ratings methodology for more details on how the top-rated products were selected.
Best home loans for first home buyers
While many first home buyers may look for the same things from a home loan as someone who already has a loan and is switching, there are certain features that can be of particular interest to those setting out on their property journey. In other words, the best home loan for a first home buyer may be different to the best loan for an established borrower.
For example, some first home buyers may be interested in lenders who allow them to get a home loan with a low deposit or, put another way, a high loan-to-value ratio (LVR). They may also be particularly interested in loans that allow them to make extra repayments without paying a fee, so they can get their initially large home loan balance down as quickly as possible to save on interest.
When assessing home loan providers as part of its annual First Home Buyer Award, Canstar considers a range of factors, including:
- Tools and resources that help first home buyers plan for their first home, such as budgeting tools and savings accounts.
- The application process. For example, what channels can you use to apply (in-branch, over the phone, online etc.)? What guarantee and/or deposit options does the lender offer to borrowers?
- Managing your home loan. What options does the lender offer when it comes to making repayments on its home loans? Does it offer redraw or offset facilities? And, most importantly, what fees and interest rates does it charge?
- Assistance and support offered by the lender to customers, including online and phone help and the availability of branches and mobile lenders for in-person guidance.
- Closing your home loan and in particular how easy and inexpensive the lender makes that process
Best home loans for refinancers
If you’re considering refinancing your home loan, chances are lowering your regular repayment and overall interest costs are among the main objectives in mind. But the best home loan to help you save money over the long term isn’t necessarily the one with the lowest interest rate.
For example, as an established borrower you may have built up some savings since you bought your home, and you may decide that having a loan with an offset account to stash that cash in is an important factor for you, even if it means having a slightly higher interest rate or paying a small fee.
Additionally, as a refinancer, you’ll likely have a lower LVR than when you took out your loan initially, assuming you’ve been keeping up with your repayments and your property hasn’t decreased in value. This could open up more options for you as some lenders reserve their best rates for lenders with a higher level of equity in their property.
Compare some of the top refinance rates
Best home loans for investors
Canstar’s annual Investment Home Lender Awards recognise the providers that Canstar found to offer outstanding value across their range of investment home loan products. Providers’ products are assessed on price (interest rate and fees) as well as the features offered to investment customers, such as options for repaying the loan and the availability of offset accounts and redraw facilities. There are three separate Awards to recognise lenders offering outstanding value to fixed and variable investor home loan customers, as well as an overall Award.
How to find the best home loan for you
The product that ends up being the best home loan for you overall will depend on your personal circumstances and goals. That said, in addition to considering Canstar’s Home Loan Star Rating and Awards, here are five general tips that could help you shop around for a loan with more confidence.
- Focus on more than just the interest rate: The loan’s comparison rate, which should be advertised alongside the interest rate, is designed to give you a more accurate idea of the real cost of a loan each year, as it includes a range of fees charged by the lender in addition to the interest rate.
- Keep an eye on features: Having access to features such as an offset account could help you save money on interest.
- Consider flexibility: For example, if the lender allows you to make more frequent repayments (e.g. weekly or fortnightly instead of monthly), this could help you save on interest. The same goes for being able to make extra repayments without penalty.
- Look at fixed and variable options: The best option to choose might be driven in part by how much certainty you would like over your repayments in future. Fixed loans offer greater certainty for the first few years of your loan, but are generally less flexible. Some lenders offer split home loans that combine aspects of the two loan types.
- Shop beyond just the big banks: In many cases, the cheapest rates are offered by some of the smaller lenders.
Main image source: Jodie Johnson/Shutterstock.com
This article was reviewed by our Editor-in-Chief Nina Rinella before it was updated, as part of our fact-checking process.
Owner occupied
20% min deposit
Redraw facility
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