The new magic home loan number: Are you paying too much?


04 Jun 2020

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Mortgage repayments are the biggest household expense for many Australians, and also a prime target for big potential savings. Most borrowers know how important it is to have a competitive home loan, but how many of us really know what that means?

New research from the home loan comparison experts at Mozo reveals that 2.80% 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.

Switching from the average big 4 bank home loan rate of 3.67% to the best on the market could save a borrower with a $500,000 mortgage a whopping $4,150 a year over 30 years.^ Sound attractive? Take a look at some of the top home loans under the magic 2.80% below, and see how much you could save.

Top Home Loans Under 2.80% Smart Home Loan 80
  • 2.63% variable rate (2.65% comparison rate*)

  • $0 application or ongoing fees

  • Unlimited free extra repayments and redraw facility

Looking for a loan that could help you save thousands on your mortgage? Then look no further than the Smart Home Loan from With a killer ultra low rate, this competitive home loan from one of Australia's top non-bank lenders is packed with handy features like free extra repayments, unlimited free redraw and a split rate option. A huge contender in the low interest rate mortgage arena, this loan has all the perks you need and nothing you don’t.

Where do I get itHead over to to find out more >>

UBank UHomeLoan - Discount Offer
  • 2.59% variable and comparison rate

  • No hidden fees plus free extra repayments and redraw

  • Best Low Cost Home Loan - Mozo Experts Choice Awards 2020

The UBank UHomeLoan is a multiple award winner, and with such great value on offer it's not hard to see why. Being an online bank, UBank is able to offer super competitive rates and get rid of hidden costs such as application and ongoing fees. The super low rate is available for loans of $200,000 or more with a minimum deposit of 20%, and the online application process is fast and simple. You'll also have the security of knowing that UBank is backed by NAB.

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

HSBC Fixed Rate Home Loan
  • 2.09% fixed rate for 2 years (2.98% comparison rate*)

  • No upfront application or ongoing service fees

  • Free extra repayments up to $10,000 a year

This market leading new 2 year fixed rate home loan lets you guarantee your monthly repayments while still taking advantage of flexible features like the ability to make free extra repayments up to $10,000 a year and split your loan between fixed and variable rates. What's more, there are no upfront or ongoing fees and you'll get a relationship manager to help you through the application process. Available to borrowers with 20% deposit for loans of $50,000 or more. 

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

People's Choice Credit Union Basic Variable Home Loan
People's Choice Credit Union
  • 2.69% p.a. variable and comparison rate*

  • Free extra repayments and redraw facility

  • No upfront or ongoing fees

A low variable rate that could save you thousands? Tick. Flexible features like free extra repayments and redraw? Double tick. This great all-rounder home loan from one of Australia's largest credit unions, People's Choice, has everything you want and nothing you don't, such as pesky fees. So if you like the sound of a simple, great value home loan from a trusted credit union with a genuine customer first approach, this could be the loan you've been waiting for.

Where do I get it? Head over to People's Choice to find out more >>

Athena Liberate Variable Home Loan
  • 2.59% variable rate (2.55% comparison rate*)

  • Zero Athena fees plus free extra repayments and redraw

  • Mozo Experts Choice Low Cost Home Loan 2020

Online lender Athena is shaking up home loans with a customer first approach and some of the best value mortgages on the market. The Athena Home Loan has one of the lowest variable rates around and no application, valuation or ongoing fees, not to mention a loyalty bonus each year for 5 years just for making your repayments on time. It also offers free extra repayments and a free redraw facility. Available to refinancers with at least 70% equity, living in a capital or major regional city.

Where do I get it? Head over to Athena 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 the amount and term you entered.

**Initial monthly repayment figures are estimates only, based on the advertised rate, and a loan of $500,000 repaid over 25 years. 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 loans Awards

Want to compare more home loans? View the latest mortgage rates from over 80 lenders at Mozo's home loan comparison hub.

^ Savings calculated for an owner occupier P&I borrower with a $500,000 loan amount and an 80% LVR.

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