The magic home loan number you need to know
Kelly Emmerton | 14 May 2018
We talk a lot about how important it is to find a great home loan deal, but do you really know what that means?
New research from the home loan comparison experts at Mozo reveals that 3.70% is the new benchmark for home loan rates, so if your rate is higher than this, you could be paying too much interest.
Despite the fact that half the lenders in the Mozo database currently offer an owner occupier rate at or below the magic number, many Aussies are still paying too much on their mortgage, with the average rate sitting at a steep 4.35%.
“By being on the lookout for more competitive rates under the 3.70% benchmark, borrowers have the potential to save thousands of dollars a year on their home loan,” says Mozo Director, Kirsty Lamont.
Snag a low rate home loan today - rates updated daily
- loans.com.au
Essentials Variable 80
Owner Occupier, Principal & Interest
3.64% p.a.
3.66% p.a.
A low-rate home loan that could save you thousands. No monthly or ongoing fees. Unlimited additional repayments. Unlimited free redraws with no minimum redraw amount
-
3.64% p.a.
-
3.66% p.a.
-
$520
-
$0.00
-
$0.00
-
yes - free
-
yes - free
-
no
-
80.00%
-
$50,000
-
$2,000,000
-
Variable
-
Principal & Interest
-
Owner Occupier
-
Weekly, Fortnightly, Monthly
Details Close
-
- State Custodians
Low Rate Home Loan with Offset
LVR<80%, Owner Occupier, Principal & Interest
3.68% p.a.
3.69% p.a.
A Low Rate Home Loan with a $0 Application Fee, Free Redraws & Extra Repayments
-
3.68% p.a.
-
3.69% p.a.
-
$0
-
$0.00
-
$300.00
-
yes - free
-
yes - free
-
yes
-
80.00%
-
$100,000
-
$2,000,000
-
Variable
-
Principal & Interest
-
Owner Occupier
-
Weekly, Fortnightly, Monthly
Details Close
-
- Newcastle Permanent
Discounted Variable Home Loan Premium Plus Package
Owner Occupier, Principal & Interest
3.82% p.a.
4.22% p.a.
Experts Choice - Australia's Best Customer-Owned Banking & Home Lender of the Year 2018
-
3.82% p.a.
-
4.22% p.a.
-
$0
-
$395.00 yearly
-
$0.00
-
yes - free
-
yes - free
-
yes
-
95.00%
-
$150,000
-
-
-
Variable
-
Principal & Interest
-
Owner Occupier
-
Weekly, Fortnightly, Monthly
Details Close
-
- HSBC
Discounted Home Value Loan
Owner Occupier, Principal & Interest
3.59% p.a.
3.61% p.a.
Discounted rate for the life of the loan. A relationship manager to help you through the application process.
-
3.59% p.a.
-
3.61% p.a.
-
$150
-
$0.00
-
$300.00
-
yes - free
-
yes - free online
-
no
-
90.00%
-
$50,000
-
$7,500,000
-
Variable
-
Principal & Interest
-
Owner Occupier
-
Weekly, Fortnightly, Monthly
Details Close
-
- Well Home Loans
Well Balanced
Owner Occupier, Principal & Interest, LVR <80%
3.49% p.a.
3.53% p.a.
Well Balanced home loan is a low rate home loan with free online redraw and no valuation fee. Purchase, Refinance or Equity Release purposes allowed.
-
3.49% p.a.
-
3.53% p.a.
-
$600
-
$0.00
-
$300.00
-
yes - free
-
yes - free
-
yes - $10/month
-
80.00%
-
$10,000
-
$2,000,000
-
Variable
-
Principal & Interest
-
Owner Occupier
-
Weekly, Fortnightly, Monthly
Details Close
-
- Homestar
Variable Rate Loan
LVR 70-80%, Owner Occupier, Principal & Interest
3.54% p.a.
3.59% p.a.
$900 Cashback after your settlement. Loans from $200,000 to $750,000. 100% offset account available. No annual or monthly fees.
-
3.54% p.a.
-
3.59% p.a.
-
$567
-
$0.00
-
$535.00
-
yes - free
-
yes - free
-
yes
-
80.00%
-
$200,000
-
$749,999
-
Variable
-
Principal & Interest
-
Owner Occupier
-
Weekly, Fortnightly, Monthly
Details Close
-
- Bank Australia
Basic Home Loan Special
LVR<80%, Owner Occupier
3.65% p.a.
3.66% p.a.
A Basic Home Loan which offers a competitive interest rate and other features to make your home or investment loan more affordable. No establishment fee until 31/12/2018. Option to fix full loan or split between fixed and variable. Redraw available.
-
3.65% p.a.
-
3.66% p.a.
-
$0
-
$0.00
-
$250.00
-
yes - free
-
yes - free
-
no
-
80.00%
-
$10,000
-
-
-
Variable
-
Principal & Interest
-
Owner Occupier
-
Weekly, Fortnightly, Monthly
Details Close
-
Crunching the numbers
On a $300,000 home loan over 30 years, the difference between the cost of the average home loan rate and the lowest in the Mozo database is $59,276 - a considerable chunk of change for a household to save*.
“There’s potentially tens of thousands of dollars in savings up for grabs for those who take the time to shop around and find a great deal,” said Lamont.
Tips for choosing a bargain home loan rate
Check the comparison rate. One really handy tool when trying to decide what the best value loan for you is, is the comparison rate. This rate takes into account both the interest and guaranteed fees on a loan, to give you a more accurate idea of the ‘true’ cost of a loan and help you compare your options on even footing.
Decide what you really need. Many home loans come with a bunch of handy features like free extra repayments and offset accounts which can save you a tonne of money on interest. The downside is that full feature home loans often have more fees or higher interest rates attached. So it’s worth working out exactly what features you’ll use and look for a home loan to suit, so you’re not paying for extras you don’t use.
Compare your options. An easy way to compare a heap of home loans from a wide array of lenders is to use our home loan comparison table. Or, if you’re refinancing, take our Switch and Save calculator for a whirl to find out how much a better deal could save you.
*Based on a $300,000 loan over 30 years, 80% LVR, principal and interest repayments. Lowest rate in the Mozo database is 3.49% from Reduce Home Loans.
Mozo may receive advertising fees from the financial institutions, issuers of financial or credit products and third party advice providers that are shown on this page. These fees are based on a cost per click, cost per acquisition, or a fixed fee.
