Home loan fees to be aware of
Lenders may charge a variety of home loan fees. These can be broken down into three main categories: Upfront, ongoing and discharge.
1. Upfront home loan fees
Your lender may charge a variety of upfront fees when you first take out a home loan. These are typically one-off fees, and they can take a bite out of your budget. Upfront fees can include:
Application or loan establishment fees
When you set up a new home loan, you’ll usually be charged an application, establishment, or set-up fee, which can vary between lenders.
A bit over a third (38%) of the lenders on Canstar’s database charge an application fee, so you may be able to avoid this cost altogether.
Among those that do, the average cost was $468 at the time of writing. There can, however, be big variations, with application fees ranging from $150 to $990 among lenders charging them.
While both application and establishment fees are often mentioned interchangeably, they may be charged separately.
Mortgage registration fees
A mortgage registration fee is a government fee you pay to register your home loan lender’s interest in the home you’re buying. Registering a mortgage through your state or territory’s land register attracts a fixed fee, which varies from state to state.
At the time of writing, mortgage registration attracts the following fees:
- QLD: $258
- NSW: $182.73
- VIC: $129.20 (via PEXA) or $139.50 (via form)
- ACT: $178
- NT: $176
- SA: $198
- TAS: $163.30
- WA: $216.60
Valuation fees
Your lender may ask you to pay a valuation fee. This covers the cost of having the home you’re planning to buy professionally valued.
You may have difficulty securing a loan approval if the valuation comes in lower than expected.
While the average valuation fee charged by lenders on Canstar’s database is $257, it’s common to be asked to pay anything from $50 to $400.
Legal fees
Lenders may pass on the legal fees involved in preparing formal loan documents. Legal fees range from $225 to $430, with the average fee being $315 among lenders that pass this cost on across Canstar’s database.
Bear in mind, a lender’s legal fees are separate from your own legal fees. You’ll likely still need to pay for your own solicitor or conveyancer.
Settlement fee
A settlement fee may be charged when you first take out a home loan, when you want to top up your loan with additional funds, or if you refinance to a new loan. On average, expect to pay around $250 (with lenders on our database charging anywhere from $100 to $595).
Lenders Mortgage Insurance (LMI)
If your deposit is worth less than 20% of your dream property’s market value, you may have to pay Lenders Mortgage Insurance (LMI). LMI protects the lender from financial losses if you default on your mortgage.
Typically, LMI is paid by the buyer as a one-off fee. Alternatively, the cost of LMI can be added to your mortgage amount, but you will have to pay interest on that amount over the life of the loan, which can leave you paying tens of thousands out of pocket.
Here are some ways you can avoid LMI completely:
- 5% Deposit Scheme: The Australian Government’s 5% Deposit Scheme may help you avoid LMI completely. However, you must be a first home buyer or single parent, borrow from an approved lender, and satisfy other criteria to access it.
- Help to Buy Scheme: Eligible homebuyers with a minimum deposit of 2% may be able to purchase a home alongside the Federal Government via the Help to Buy Scheme.
- Have a home loan guarantor: If someone you know is happy to be your guarantor, it might help you avoid paying for LMI.
- LMI waivers: Some major banks may offer LMI waivers to professionals working in specific industries, provided they meet other criteria.
2. Ongoing fees
A variety of ongoing home loan fees may also apply to your mortgage, depending on your lender and choice of home loan. There are two main fees to be aware of:
Monthly home loan fees
Not all home loans charge monthly fees (also known as ‘loan service fees’). Across Canstar’s database, a little over one in 10 loans (12%) charge a monthly fee, with the average being $11 per month.
These fees can be anywhere from $8 to $20 a month. This may seem like a small amount, but over the course of a 25- or 30-year home loan, they can really stack up.
Annual package fees
Package home loans typically bundle multiple financial products together, like a home loan, offset account, and credit card. They might even provide an ongoing interest rate discount. In return, homeowners pay an annual package fee. Among package loans on the Canstar database, the average annual package fee is $361, though it commonly ranges from $199 to $415 each year.
3. Fees charged to close your home loan
Paying off your mortgage or refinancing may offer substantial benefits, but can also bring about certain fees.
Discharge fees
A discharge fee is an admin cost associated with ending your loan, either when you pay it off in full or if you refinance to a different lender.
While a small minority of lenders may not pass on discharge fees, 96% of the loans on Canstar’s database do. These discharge fees can range from $150 to $795, with the average sitting at $334.
Average home loan fees
Here's the data on fees on the home loans in Canstar's database:
Home Loan Fees | ||||
Min | Average | Max | % Of Loans That Charge A Fee* | |
Application Fee | $150 | $468 | $990 | 38% |
Valuation Fee | $50 | $257 | $400 | 14% |
Legal Fee | $225 | $315 | $430 | 12% |
Settlement Fee | $100 | $250 | $595 | 38% |
Annual Package Fee | $199 | $361 | $415 | 96% |
Ongoing Monthly Fee | $8 | $11 | $20 | 12% |
Discharge Fee | $150 | $334 | $795 | 96% |
Source: www.canstar.com.au - 31/08/2026. Based on owner occupier variable loans on Canstar’s database available for a loan amount of $600,000, 80% LVR and principal & interest repayments; excluding introductory and first home buyer only loans.*Valuation, legal, documentation and settlement fees are often calculated at cost; the values in this table are based only on lenders that advertise a fixed value. | ||||
How to measure the true cost of home loan fees
Instead of comparing loan interest rates in isolation, it’s crucial to look at their comparison rates. The comparison rate includes both the home loan interest rate and the cost of most fees relating to the loan.
It helps you get a clearer picture of the true cost of a loan and enables a more accurate comparison of a home loan’s underlying costs.
However, some home loan fees and charges aren’t factored into the comparison rate, as they may only apply in certain circumstances. These typically include:
- LMI
- Late payment fees, which can be payable if you fall behind with your regular home loan repayments.
- Break fees, or break costs, incurred if you break out of a fixed-rate home loan before the fixed-rate term is over.
- Redraw fees may apply if you make use of a redraw facility (depending on your lender)
Another point to note is whether additional loan features justify the extra fees. A loan may charge a higher fee in exchange for access to
- An offset account, which could help you reduce your interest costs, or
- a redraw facility, giving you access to extra repayments you’ve made.
In this case, it could be worth calculating your interest savings and whether they outweigh the higher fees.
