How much could switching to Unloan actually save you?

By Evlin DuBose · · 3 min read
Fact Checked
Advertiser disclosure
Collage of a person beckoning you to come look at the cyberverse (aka Unloan) while coins fall behind them.

If you’re refinancing your home loan, one of the most popular recommendations to check out these days is Unloan. 

And no wonder! With an interest rate 0.85% lower than the Mozo database average, a cumulative loyalty discount that shaves 1 basis point off your mortgage every year (with conditions), and a history of withholding from the full RBA rate hikes, there’s a lot going for it.

While estimating your future mortgage repayments can be tricky since variable rates ebb and flow with the economic tide, it’s worthwhile crunching some numbers to see your savings in action – and with such a unique discount rate, it’s well worth investigating. 

So let’s do some mortgage maths: how much could the Unloan loyalty discount actually save you?

Crunching the numbers of Unloan’s loyalty discount

Collage of a man in a yellow background reaching up to calculate the costs of Unloan

In theory, if you were eligible for the maximum Unloan discount rate (so 0.30% off the variable rate offer at the time), it could save you hundreds of on your monthly repayments, depending on the size and term of your loan. 

However, this is the golden scenario, and it doesn’t consider long-term savings over the life of your home loan: only what you’re saving during that year. In that way, Unloan’s discount rate just accumulates a buffer against the maximum interest rate – more of an “I could be paying much more than I am” reward. 

Still, if you’re looking to refinance, it’s worthwhile investigating how 0.01% p.a. off your interest rate could affect your monthly budget. 

For example, if you refinance to Unloan at its current variable rate of 4.99% p.a. (4.90% p.a. comparison rate*) with $500,000 left on your principal for a 20-year loan term, then, provided Unloan makes no rate hikes or cuts, in your first year you would repay $3,297 per month, according to Mozo’s mortgage repayment calculator.

But on the anniversary, your interest rate would decrease to 4.98% p.a., bringing your monthly repayments down to $3,294. This means the discount would only save you $3 a month during your second year ($36). 

If we plug the situation into Unloan’s repayment calculator, you can see how this could play out over time. Someone with a 0.20% (20-year) discount would pay $28 less per month than they did at the start of the loan.

Discount
1-year
5-year
10-year
15-year
20-year
Interest rate4.99% p.a.
4.95% p.a.
4.90% p.a.
4.85% p.a.
4.80% p.a.
Monthly repayments$3,297$3,285$3,276$3,271$3,269
Yearly savings$0$144$252$312$336

Mathematically, however, this assumes a lot of unrealistic conditions, like an unchanging variable rate and a constant time-value to money. Mostly, the table just illustrates the cushion Unloan’s discount could give you depending on the year. 

However, home loans are long-term commitments (no pun intended), so how much would Unloan actually save you over time?

Okay, but how much could Unloan save you long-term?

Collage of a person surfing the wave of home loan savings...in spaaaace.

When you make mortgage repayments, typically you pay down a portion of your principal (the amount you initially borrowed) with compounded interest tacked on. The amount of interest you pay will change as you pay down your principal over time precisely because it’s compounded. Add to that a decrease of 1 basis point yearly, and Unloan creates a gradual shift in your repayments.

There’s no easy formula to see this action, so solving the problem requires some fiddling around with a mortgage calculator. Luckily, Mozo loves calculators.

If we start with a base rate of 4.99% p.a. (4.90% p.a. comparison rate*) on a 20-year mortgage with $500,000 in principal, we can estimate the savings with the Unloan discount, provided the interest rate doesn’t change. Simply add the difference between each year’s monthly repayments and then voilá: savings!

So how does it look?

According to our majestic (and somewhat magical) maths, Unloan’s discount could in theory save you $4,296 in interest over twenty years, on top of any savings you could get from the competitively low interest rate. (But keep in mind this number doesn’t include any extra repayments or interest rate changes you may have over the life of your loan).

At the end of the day, the core of this question might really be: is Unloan’s discount worth it? And the answer? Up to you. There are plenty of vital questions to ask yourself when refinancing, and the interest rate is merely one of them. 

But if a loyalty reward sounds like a great perk to you, it could make Unloan well worth checking out! Not to mention Unloan won "Best New Home Loan" at this year's Mozo Experts Choice Home Loan Awards, so it's an eye-catching offer all around. 

Compare low-interest rate home loans below.

Home loan comparisons on Mozo

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Last updated 27 July 2024 Important disclosures and comparison rate warning*

Promoted

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.

  • Neat Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Competitively-priced variable rate loan. Ideal for owner occupiers and investors. No service fees to pay. Make free extra repayments and redraws. Flexible repayment schedule available.

  • Special Real Deal Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.13 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.

  • Optimum Fixed Rate Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.69 % p.a.
    Fixed 3 years
    Comparison rate
    6.34 % p.a.
    Initial monthly repayment
    $2,899
    Go to site

    Lock in a competitive interest rate and enjoy peace of mind for the fixed period. Available for owner occupied new and refinanced home loans with at least 20% deposit. Split option available as well as offset and redraw. Noapplication, ongoing or banking fees. Third Party fees may be applicable - payable within loan repayments. Extra repayments up to $20K per annum permitted. Apply online, 100% member owned credit union.

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • OMG Home Loan

    • Owner Occupier
    • Principal & Interest
    • <60% LVR
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    6.02 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    BCU Bank’s OMG owner occupied home loan offers a variety of great low rates depending on your deposit. Save with no ongoing annual fees. Access your extra payments when you need to through the redraw facility. Pre-approval valid for 3 months.

  • Flex Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    5.99 % p.a.
    Fixed 3 years
    Comparison rate
    6.34 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Competitive Fixed rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.

  • Express Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <90%
    Interest rate
    6.01 % p.a.
    Variable
    Comparison rate
    6.14 % p.a.
    Initial monthly repayment
    $3,001
    Go to site

    Get online approval from the award-winning Bendigo Bank Express Home Loan. Multiple offset accounts and redraw available. 100% offset on variable rate loans and partial offset on fixed rate. Flexible repayment options. New home loans only.

  • Neat Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Competitively-priced variable rate loan. Ideal for owner occupiers and investors. No service fees to pay. Make free extra repayments and redraws. Flexible repayment schedule available.

  • Special Real Deal Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.13 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.

  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.

  • Flex Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.38 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Competitive variable rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.

  • Offset Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.39 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Ability to open up to 10 offset accounts per loan account. Fast online application. Linked Debit Mastercard® with fee-free access at ATMs across Australia. Package a credit card with your home loan and the annual card fee will be waived (T&Cs apply). 40% deposit required.

  • Basic Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR<70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.20 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $10,000,000.

  • Offset Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR <70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.42 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.54 % p.a.
    Fixed 2 years
    Comparison rate
    7.10 % p.a.
    Initial monthly repayment
    $3,174

    Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.

image of houses

Need help with refinancing?

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* 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.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

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