Top 5 tips for negotiating a cheaper home loan if your fixed-rate is ending

A smiling woman reading something on her phone in her home.

As hundreds of thousands of fixed-rate home loans are set to expire in the next 12 months, existing borrowers have a few strategies at their disposal that could mean the difference between expensive rollover rates and a better deal.

According to Zippy Financial, 40% of fixed-rate loans from 2022 are due to expire by the end of 2023, with an additional 20% expiring by the end of 2024. 

Zippy Financial Director, Louisa Sanghera says this may leave many borrowers unable to refinance their home loans due to interest rate rises that price them out of finding a new lender. This is also known as being a home loan hostage.

“The rapid increase in interest rates since May last year means many existing borrowers are stuck with their current lenders because they simply don’t qualify to refinance elsewhere at present,” Sanghera said.

“However, that doesn’t mean that borrowers need to just accept any old ‘offer’ from their lender or – worse still – simply allow their home loans to roll over to the advertised variable rates.

“Rather, by being proactive and undertaking some simple research, existing borrowers can give themselves a better chance of securing a much better home loan rate.” 

1. Compare home loans to find the best rates on offer 

Sanghera suggests that borrowers should take the time to research and compare home loans to find the lowest rates currently available. 

“Find the best rate in the market then take that rate to your bank and ask them to beat it,” she said.

Some of the lowest variable rates in the Mozo database for owner-occupiers with a loan-to-value ratio (LVR) of 80% or less are below. (This is based on principal and interest on a $400,000 loan):  

2. Speak to your lender’s retention team 

Sanghera says that a common mistake made by those trying to negotiate their rates is that they’re speaking to the wrong people. 

“Always ask for the bank’s retention team directly as they have the best rates, rather than someone who may just be in the home loan call centre,” she said. 

3. If at first you don’t succeed… 

Sanghera says that if your first attempt at renegotiating your home loan rate doesn’t work out the way you’d hoped, you shouldn’t give up. 

“If the rate they offer you is still underwhelming, don’t give up, and repeat the same process every six months,” she said.

A lot can change in six months, especially when it comes to interest rates. By calling your lender every so often, you may find that you can successfully get your interest rate shaved down in increments. 

Plus, as you pay down your mortgage over time and accrue equity, your LVR will drop, which could result in lenders offering lower interest rates.   

4. Use the equity you’ve built as leverage 

Sanghera says that homeowners can use home equity to get cheaper rates

By ‘name-dropping’ your LVR, you can actually use it to your advantage when negotiating, she said. 

“Lower loan-to-value ratios, or LVRs, do carry lower rates with lenders. So, if your property has gone up in value, you may qualify for a cheaper rate, so make sure you know your current LVR before calling,” she said. 

5. Ask your lender to waive fees 

If your lender won’t offer you a lower interest rate, there are still other ways to save, according to Sanghera.

“If they say they can’t lower the rate, then ask if they can waive the annual fee instead,” she said. 

Of course, if your lender won’t budge and the option is still there to refinance your home loan, that might be your best bet for a lower rate.  

But before you jump at the cheapest home loan you can find, compare your options to ensure there isn’t a better fit out there for you and your property. 

You can start by comparing home loans with Mozo and checking out some of the featured products below, or browsing through the best home loans in Australia

Home loan comparisons on Mozo

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can search our database of 473 home loans.
Last updated 21 June 2024 Important disclosures and comparison rate warning*
  • 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.

  • 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.

  • 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.

  • Discount Variable Home Loan

    • Owner Occupier
    • LVR<70%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    6.01 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    A low rate home loan for owner-occupiers packed with great features including unlimited extra repayments, free online redraw, no application or monthly admin fees. Rate will vary depending on LVR. Winner of a Mozo Experts Choice 2024 Low Cost Home Loan Award^

  • Variable Home Loan 90

    • Principal and Interest
    • LVR <90%
    Interest rate
    6.04 % p.a.
    Variable
    Comparison rate
    6.06 % p.a.
    Initial monthly repayment
    $3,011
    Go to site

    Affordable home loan rate for buyers or refinancers. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 10% deposit required.

  • Fixed Rate Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.09 % p.a.
    Fixed 3 years
    Comparison rate
    6.15 % p.a.
    Initial monthly repayment
    $3,027

    Additional repayments of up to $10K per fixed year. Interest rate discounts available. Waiver of $499 application fee when combined with an Orange Advantage Home Loan.

  • The Better Home Loan Special Offer

    • Owner Occupier
    • Principal & Interest
    • LVR<80%
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.14 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a variable rate home loan with a bunch of features from Police Credit Union. Make extra repayments at any time without penalty. No monthly, annual or upfront fees. Free online redraw. Minimum 20% deposit. Qualifying criteria applies. Minimum loan amount is 200K. For new customers only. Mozo Experts Choice Home Lender Credit Union of the Year 2023.

  • 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.

  • Mortgage Simplifier

    • LVR<80%
    • Owner Occupier
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.17 % p.a.
    Initial monthly repayment
    $3,043

    Get a competitive variable rate with ING’s Mortgage Simplifier. Free extra repayments, no monthly or annual fees. Freedom to make free extra repayments or redraws.

  • 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 $750,000.

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.59 % p.a.
    Fixed 3 years
    Comparison rate
    7.06 % p.a.
    Initial monthly repayment
    $3,190

    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?

You might have questions that need personal answers. We’ve teamed up with the mortgage brokers at Lendi to get you the answers you need, and a home loan deal you deserve.

Learn 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.

** 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

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