Four in five home borrowers make $18,000 mistake


11 Mar 2019


There is an easy way to potentially save thousands on your home loan, but surprisingly, most Aussies ignore it. Four in five borrowers take out a home loan with a Big 4 bank, instead of shopping around for cheaper loan. This mistake is costing us big time.

Research from Mozo reveals that the difference between the cheapest home loan rates from the big banks and online lenders can be $18,011 on a $400,000 home loan over 30 years. Why the difference? Well for starters, online lenders have lower costs than bricks and mortar banks so they can pass these savings onto borrowers in the form of lower interest rates and fees.

Right now, you can compare online lenders on Mozo with rates starting from below 3.50%. So, if you'd like to compare and see if you can save, read on for our run down on four of the top online loans on the market right now.

Top Online Home Loans

Promoted Smart Home Loan
  • 3.48% variable rate (3.50% comparison rate*)

  • Unlimited free extra repayments and redraw facility

  • No application or ongoing fees

Our verdict

Aussie owned has been offering up simple, low rate home loans since 2011. This wallet-friendly option is the perfect no-fuss mortgage, with all the features you want and none you don’t - you can make unlimited extra repayments and make use of the redraw facility, without paying a premium for bells and whistles like an offset account. If you’re borrowing $1million or less and have at least a 20% deposit saved up, the Smart Home Loan might be the mortgage for you.

Where do I get it? Head over to to find out more >>


UBank UHomeLoan - Discount Offer
  • 3.59% variable rate (3.59% comparison rate*)

  • No ongoing or upfront fees

  • Free extra repayments and redraw facility

Our verdict

As one of the top online banks in our database, UBank has our seal of approval when it comes to offering Aussie borrowers the best bang for their buck. Why? Well, for one, with no fees, a low interest rate and plenty of flexible payment options, the UHomeLoan Discount Offer is pretty hard to argue with. Plus, UBank is backed by NAB so you get all of the savings an online lender can offer, as well as the security of big bank backing. It’s available for loans of $200,000 or more, with a 20% deposit.

Where do I get it? Head over to UBank to find out >>


State Custodians Low Rate Home Loan with Offset
  • 3.58% variable interest rate (3.59% comparison rate*)

  • No application or ongoing service fees

  • Free extra repayments, redraw facility and offset account

Leading online lender, State Custodians is an award-winning Australian non-bank lender offering up low rate home loans with all the bells and whistles you'd normally find in a more expensive loan. How do they do this? Dealing directly with State Custodians instead of going through a broker, borrowers reap the savings in the form of lower rates and fees. With this loan you'll get a free 100% offset account, free redraw, extra repayments and split loan facility, plus an ultra competitive interest rate.

Where do I get it? Head over to State Custodians to find out more >>


ME Basic Home Loan
  • 3.97% variable rate (3.99% comparison rate*)

  • No monthly fees (upfront fee applies)

  • Free extra repayments and redraw facility

Our verdict

Sometimes, simple is just what you need. The ME Basic Home Loan is a great value loan with a few key features to help you save even more while paying down your mortgage, like the ability to make extra repayments and choose either a weekly, fortnightly or monthly repayment schedule. ME is an online lender, but you can choose to meet with a home loan specialist at a time and place that suits you to help you get started. No drama, no fuss, just excellent value.

Where do I get it? Head over to ME to find out more >>

*WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

Information in this article sourced from

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