Compare 2 year fixed home loans

The table below displays 2-year fixed home loans from our Online Partners.

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promoted
Fees & charges apply. Australian Credit Licence 231204.
4.99%
2 year fixed
5.86%
$1,877
Principal & Interest
Owner occupied
20% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 231204. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 231204. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 238311.
5.30%
2 year fixed
5.38%
$1,944
Principal & Interest
Owner occupied
5% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 238311. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 238311. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 496431.
5.29%
2 year fixed
5.50%
$1,941
Principal & Interest
Cashback
Cashback
Owner occupied
10% min deposit
Redraw facility
Fees & charges apply. Australian Credit Licence 496431. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 496431. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR
promoted
Fees & charges apply. Australian Credit Licence 237502.
5.29%
2 year fixed
5.64%
$1,941
Principal & Interest
Owner occupied
20% min deposit
Fees & charges apply. Australian Credit Licence 237502. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 237502. Star Rating for a $350k owner occupier 2 year fixed rate P+I loan at 80% LVR

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The initial results in the table above are sorted by Star Rating (High-Low) , then Comparison rate^ p.a. (Low-High) , then Provider Name (Alphabetical) . Additional filters may have been applied, which impact the results displayed in the table - filters can be applied or removed at any time.

promoted
Fees & charges apply. Australian Credit Licence 237391.
Interest rate p.a.
Comparison rate^ p.a.
Monthly repayment
5.54%
Variable
5.57%
$1,996
Principal & Interest
IMB Bank Budget Home Loan
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Fees & charges apply. Australian Credit Licence 237391. See Terms & Conditions. ^ Comparison Rate Warning. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR
Fees & charges apply. Australian Credit Licence 237391. See Terms & Conditions. ^ Comparison Rate Warning. Star Rating for a $500k owner occupier variable rate P+I loan at 80% LVR

What type of home loans are there?

When it comes to buying a home, choosing the right property is only a part of the equation – you’ll also need to choose a home loan product that best suits your needs. A two-year fixed rate home loan is one potential option, but what exactly does this mean?

When you take out a home loan, there are three main options available to you. You can choose to ‘fix’ your home loan rate, locking in your interest repayments for a set period of time, or you can choose a variable rate, which could see your interest payments going up or down, based on changes in the market rate and the decisions of your lender. You could also choose to split your loan, meaning you may be able to combine the two at a ratio you think is favourable.

One option would be to fix your home loan at a steady interest rate for two years. If you’re considering it, below are some answers to the most frequently asked questions about two-year fixed home loans. Otherwise, you can also use the comparison table at the top of the page to compare current home loans on the market from our online partners.

Frequently Asked Questions about 2-Year Fixed Home Loans

A two-year fixed rate home loan is one in which the interest rate you’ll pay on the loan is locked in place or ‘fixed’ for a period of two years, from the start of the loan. This means that throughout this entire two-year period, your required repayments will remain consistent, and your interest rate will not fluctuate.

There can be a number of possible advantages to locking in an interest rate, whether you choose to do it for two years or a different length of time. The advantages of fixed home loan rates can include:

  • a sense of certainty in your repayments. On a two-year fixed rate, your loan repayments will remain the same from month to month for the entire period, meaning you’ll be able to budget for other expenses knowing how much your mortgage will cost, and will not see your rates go up in that time. In addition to the interest rate, it may be a good idea to consider the comparison rate in working out what you may be able to afford in repayments.
  • the potential to save money on fees and charges. Variable rate loans come with added features like offset accounts and redraw facilities, which can make them more expensive. Fixed rate loans tend to come without these features, meaning that the associated fees and charges tend to be smaller.

Of course, fixed loans – whether the rate is locked in for two years or longer – can also come with some potential drawbacks. These include:

  • the potential to miss out on a lower interest rate. When you lock your rate in, you will not need to make higher repayments when there are  interest rate rises. However, if your lender lowers their variable rate, you will not be able to take advantage, as you’ll remain locked in to your current one.
  • additional fees. Breaking out early could mean paying break fees. If you are on a fixed-rate loan and wish to break it early, then typically, your lender will charge you a break fee to get out of the contract. There is no set amount for break fees, but depending on the size of your loan, they can be expensive.
  • fewer features. Variable rate loans typically come with features like an offset account, which can bring down the balance of your loan while being used as an everyday bank account, whereas fixed rate loans do not typically come with these, and if they do, you may need to pay additional fees to access them.
  • an inability to make additional repayments. Generally speaking, if you are on a fixed rate loan, you will be unable to make additional repayments to bring down the balance of the loan. Note that there can be some flexibility on this, depending on the lender.

Depending on the terms and conditions of a loan, it may be possible to break it before the loan term is up. There may be any number of reasons you wish to do this – you may want to sell your house, or refinance with a different lender, or you may simply want to move to a new loan product.

Explore further: Breaking a fixed-rate home loan: What are break costs?

Whatever the reason, the terms of your contract may allow you to break your loan early, but you may be charged a ‘break cost’ or a ‘break fee’. This is an amount of money that is intended to compensate a lender for lost profits they might face as a result of a borrower leaving a home loan early. While the cost of break fees varies, it generally takes into consideration:

  • the interest rate you locked in (compared with the current interest rate)
  • how much time remains on your fixed-rate term
  • the amount you originally borrowed.

You can generally choose to fix a home loan for anything up to 10years, and the amount of time you choose is a matter of your preference and what your lender is willing to offer. Depending on your needs, you may only want to lock in your interest rate for a short amount of time, such as one or two years. Alternatively, you could lock it in for three, five or even 10 years, if you want the certainty of a fixed rate for a longer period of time. The interest rate will vary depending on the term you choose.

If you’re in the market for a two-year fixed rate home loan, you can take a look at the winners of Canstar’s Fixed Rate Home Loan Awards to find out which lenders offer value for money to Australian home buyers. You can also compare home loans with Canstar, using the table at the top of this page to find a lender with a low two-year rate that suits your particular needs.

Consider the Target Market Determination (TMD) and Key Facts Sheet (KFS) before making a purchase decision. Contact the product issuer directly for a copy of relevant disclosure documents.

If you are considering a two-year fixed home loan, or any fixed home loan, one important factor to keep in mind is that your interest rate will be fixed at the date you settle on the property, not the date you applied for the loan. This means that if rates change between the time you apply and the time you settle on a house, you could end up paying more or less interest for the two-year period.

If you want certainty in your rate, some lenders will offer you the ability to lock in a rate before settlement, but you may be asked to pay a lock-in fee to guarantee it.

Generally speaking, when a two-year fixed term (or any fixed term) ends, you will revert to a variable rate for the remainder of your home loan. If you are happy moving to a variable rate, then you could choose to do this. Alternatively, you may be able to refinance your loan, either with your current lender or a new one, and you may move back onto a fixed rate at this time.

Latest in home loans

Canstar Star Ratings and Awards

Looking for an award-winning product or to switch providers or brands? Canstar rates products based on price and features in our Star Ratings and Awards. Our expert Research team shares insights about which products offer 5-Star value and which providers offer outstanding value overall. We also reveal which providers have the most satisfied customers in our dedicated Customer Satisfaction Awards.

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About the authors

Alasdair Duncan, Content Editor

Alasdair Duncan
Alasdair Duncan is Canstar's Content Editor, specialising in home loans, property and lifestyle topics. He has written more than 500 articles for Canstar and his work is widely referenced by other publishers and media outlets, including Yahoo FinanceThe New DailyThe Motley Fool and Sky News. He has featured as a guest author for property website homely.com.au. In his more than 15 years working in the media, Alasdair has written for a broad range of publications. Before joining Canstar, he was a News Editor at Pedestrian.TV, part of Australia’s leading youth media group. His work has also appeared on ABC News, Junkee, Rolling Stone, Kotaku, the Sydney Star Observer and The Brag. He has a Bachelor of Laws (Honours) and a Bachelor of Arts with a major in Journalism from the University of Queensland, and has completed a RG146 compliance training course. When he is not writing about finance for Canstar, Alasdair can probably be found at the beach with his two dogs or listening to podcasts about pop music. You can follow Alasdair on LinkedIn.

Joshua Sale, GM, Research

Joshua Sale
Joshua Sale is responsible for developing the methodology and delivering Canstar’s flagship Star Ratings, as part of Canstar’s Research Team. With tertiary qualifications in economics and finance, he enjoys helping Australians find more suitable financial products by transforming complex calculations into a consumer-friendly Star Rating that explains the values and benefits of different financial products. As one of Canstar’s company spokespeople, Joshua is confident participating in print, radio and broadcast journalism interviews. He has participated in interviews with the Australian Financial Review, news.com.au and Money Magazine, along with other leading media outlets, discussing topics such as home loan equity, banking incentive schemes, digital wallets and wider finance trends. You can follow Joshua on LinkedIn. Have a media enquiry, and interested in featuring Joshua as a financial expert and commentator? Contact Canstar’s Media Team today.

Important information

For those that love the detail

This advice is general and has not taken into account your objectives, financial situation or needs. Consider whether this advice is right for you.

Canstar may earn a fee from its Online Partners for referrals from its website tables, and from sponsorship or promotion of certain products. Fees payable by product providers for referrals and sponsorship or promotion may vary between providers, website position, and revenue model. Sponsorship/promotion fees may be higher than referral fees. If a product is sponsored or promoted, it’s an ad and it is clearly marked as such. An ad might appear in different places on our website, such as in comparison tables and articles. Ads may be displayed in a fixed position in a table, regardless of the product's rating, price or other attributes. The location of an ad doesn’t indicate any ranking or rating by Canstar. Payment of fees for ads does not influence our Star Ratings. See How We Get Paid to find out more. Payment of fees for ads does not influence our Star Ratings or Awards.

Home loan Star Ratings are updated daily. During periods of significant market fluctuations, such as adjustments to the reserve bank's cash rate, star rating updates will be paused for variable home loans until the market has stabilised. However, advertised interest rates of products will continue to be updated as advised by lenders. The results don’t include every provider in the market and we may not compare all features relevant to you. Current rates and fees are displayed and may be different to what was rated. You can find a description of the initial sort order below the table. You can use the sort buttons at the top of each column to re-order the display. Learn more about our Home Loans Star Rating Methodology. The rating shown is only one factor to take into account when considering products. The table defaults to display only home loans available to somebody borrowing up to 80% of the property value, but you can use the filters to change this. Similar products might have different features and fees depending on the amount you borrow. Contact the lender for details.

The products and Star Ratings in the table might not match your exact inputs in the selector. Sometimes the methodology uses profiles with categories or bands (e.g. income, loan amount or monthly spend), but sometimes a single methodology, without any categories or bands, is applied.  The results will show the products that most closely match your selection, based on our profiles. If you are unsure about any terms used in the comparison table please refer to the glossary.

What is a Target Market Determination?

A Target Market Determination (‘TMD’) is a document that explains which people particular financial products may be suitable for (the target market) and sets out any conditions around how financial products can be distributed to consumers.

Why do product issuers provide Target Market Determinations?

From 5 October 2021, TMDs are compulsory for most financial products.

Issuers and distributors of financial products must take reasonable steps that are likely to result in financial products reaching consumers in the target market defined by the product issuer.

We recommend that you consider the TMD before making a purchase decision. Contact the product issuer directly for a copy of the TMD.

Any advice on this page is general and has not taken into account your objectives, financial situation or needs. Consider whether this general financial advice is right for your personal circumstances. Canstar provides information about credit products. We’re not suggesting or recommending a particular credit product for you. If you decide to apply for a loan, you will deal directly with the provider, not with Canstar. Consider the Target Market Determination (TMD) before making a purchase decision. Contact the product issuer directly for a copy of the TMD. It’s important you check rates and product information directly with the provider. For more information, read our Detailed Disclosure. ^Read the Comparison Rate Warning.

Canstar is not providing a recommendation for your individual circumstances. We cannot and do not recommend that any particular product is suitable for you. 

We provide links to our Online Partners. These are brands that may pay Canstar a fee for referring you. Our tables default to display only our Online Partners’ products initially, you can adjust the Online Partner Filter to see all of the products available for comparison on Canstar’s website. We provide these links so that you can click through to the product provider’s website to get more information. The provision of these links does not constitute a recommendation by Canstar.

Before you elect to terminate or modify existing lending arrangements, we recommend you consider (i) your personal circumstances, and (ii) any associated fees, exit costs and application costs that may be applicable as well as the impact these changes could have on you. We suggest you consider seeking independent advice from a qualified adviser.

“Interest-only loan” generally means a loan where you will only pay interest during the interest-only term. That means you won’t be making payments which reduce debt during the interest-only term.