Why home loan rates are going up

Kelly Emmerton

02 Jul 2018

Home loan rates rise content
  • Lenders start hiking home loan rates, big banks predicted to follow

  • Switching to the lowest home loan rate could save hundreds each month

The Reserve Bank is expected to keep the cash rate on hold again today, but mortgage lenders are bumping up rates for Aussie borrowers anyway and the big banks are expected to follow.

The rate rises reflect the rising cost of funding for Aussie banks, with smaller lenders such as ING, Bank of Queensland and ME among the first to cave in and pass costs along to customers.

“Borrowers need to prepare for more rate rises in coming months, with the nation's big banks unlikely to be able to absorb increased overseas funding costs for much longer,” says Mozo Director Kirsty Lamont.

“One of the best ways to avoid rate hike pain is to refinance to a cheaper home loan now. Switching from the average home loan rate to the lowest rate in Mozo’s database could mean a yearly saving of $2,100. And having those extra funds available could make a huge difference to your budget,” says Lamont^.

Get started by comparing low rate home loans in the table below.

Low Rate Home Loans - July 2018

Rates updated daily. Advertiser disclosure.

  • loans.com.au
    Mozo Expert Choice Badge" style="width:60px;">

    1.85% p.a.variable for 24 months and then 2.25% p.a. variable

    2.21% p.a.

    $1234

    Product details Close details
    Smart Booster Home Loan

    2 Year Discounted Variable Rate, Owner Occupier, Principal & Interest, <80% LVR

    1.85% p.a.variable for 24 months and then 2.25% p.a. variable

    2.21% p.a.

    New super low introductory rate home loan for two years. Min 20% deposit. No monthly or ongoing fees. Fast settlement times. Mozo award-winning online lender. Friendly, local Australian based team.

    Smart Booster Home Loan

    New super low introductory rate home loan for two years. Min 20% deposit. No monthly or ongoing fees. Fast settlement times. Mozo award-winning online lender. Friendly, local Australian based team.

    • 1.85% p.a.variable for 24 months and then 2.25% p.a. variable

    • 2.21% p.a.

    • $520

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • Optional - with 0.10% additional interest

    • $520

    • 80.00%

    • $50,000

    • $1,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Smart Booster Home Loan

    Details Close

  • UBank
    Mozo Expert Choice Badge" style="width:60px;">

    2.19% p.a. variable

    2.19% p.a.

    $1234

    Product details Close details
    UHomeLoan - Discount Offer

    Owner Occupier, Principal & Interest

    2.19% p.a. variable

    2.19% p.a.

    Enjoy a super low rate. $0 fees to consider. Fast and easy online application. Free redraw and free extra repayments. Flexible payment terms. Min 20% deposit required.

    UHomeLoan - Discount Offer

    Enjoy a super low rate. $0 fees to consider. Fast and easy online application. Free redraw and free extra repayments. Flexible payment terms. Min 20% deposit required.

    • 2.19% p.a. variable

    • 2.19% p.a.

    • $0

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • $0

    • 80.00%

    • $100,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the UHomeLoan - Discount Offer

    Details Close

  • Athena
    Mozo Expert Choice Badge" style="width:60px;">

    1.99% p.a. variable

    1.99% p.a.

    $1234

    Product details Close details
    Celebrate Variable Home Loan

    <60% LVR, Owner Occupier, Principal & Interest

    1.99% p.a. variable

    1.99% p.a.

    Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required. Winner of three Mozo Expert's Choice Awards for 2021.

    Celebrate Variable Home Loan

    Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required. Winner of three Mozo Expert's Choice Awards for 2021.

    • 1.99% p.a. variable

    • 1.99% p.a.

    • $0

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • $0

    • 60.00%

    • $100,000

    • $2,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Celebrate Variable Home Loan

    Details Close

  • Nano

    1.99% p.a. variable

    1.99% p.a.

    $1234

    Product details Close details
    Variable Home Loan

    Owner Occupier, Principal & Interest

    1.99% p.a. variable

    1.99% p.a.

    Refinance only. Super-fast digital application process. Zero upfront fees. No on-going service fees. Free 100% offset sub account. Minimum 25% deposit required.

    Variable Home Loan

    Refinance only. Super-fast digital application process. Zero upfront fees. No on-going service fees. Free 100% offset sub account. Minimum 25% deposit required.

    • 1.99% p.a. variable

    • 1.99% p.a.

    • $0

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • yes - offset sub account

    • $0

    • 75.00%

    • $100,000

    • $2,500,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Monthly

    Read our Mozo Review to learn more about the Variable Home Loan

    Details Close

  • Macquarie

    2.14% p.a. variable

    2.14% p.a.

    $1234

    Product details Close details
    Basic Home Loan

    Owner Occupier, LVR<60%, Principal & Interest

    2.14% p.a. variable

    2.14% p.a.

    Competitive low variable rate. No application or account management fees. Flexibility to split your loan and set different repayment types. Fee free withdrawals of your savings.

    Basic Home Loan

    Competitive low variable rate. No application or account management fees. Flexibility to split your loan and set different repayment types. Fee free withdrawals of your savings.

    • 2.14% p.a. variable

    • 2.14% p.a.

    • $0

    • $0.00

    • $400.00

    • yes - free

    • yes - free

    • no

    • $0

    • 60.00%

    • $150,000

    • $5,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Monthly

    Read our Mozo Review to learn more about the Basic Home Loan

    Details Close

  • Yard
    Mozo Expert Choice Badge" style="width:60px;">

    1.99% p.a. variable

    2.02% p.a.

    $1234

    Product details Close details
    Variable Home Loan Special

    Owner Occupier, Principal & Interest, LVR <80%

    1.99% p.a. variable

    2.02% p.a.

    Yard’s low-rate variable special home loan is packed with all features – unlimited additional repayments, free redraw, 100% offset account. Enjoy a simple online application. Special rate applies to home loan applications submitted by 31st January 2022. Low Cost Home Loan winner in the Mozo's Experts Choice award 2021.

    Variable Home Loan Special

    Yard’s low-rate variable special home loan is packed with all features – unlimited additional repayments, free redraw, 100% offset account. Enjoy a simple online application. Special rate applies to home loan applications submitted by 31st January 2022. Low Cost Home Loan winner in the Mozo's Experts Choice award 2021.

    • 1.99% p.a. variable

    • 2.02% p.a.

    • $530

    • $0.00

    • $500.00

    • yes - free

    • yes - free

    • Optional - $10 per month

    • $530

    • 80.00%

    • $150,000

    • $5,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    • Special rate applies to home loan applications submitted by 31 January 2022.

    Read our Mozo Review to learn more about the Variable Home Loan Special

    Details Close

  • HSBC

    1.97% p.a. variable

    1.98% p.a.

    $1234

    Product details Close details
    Discounted Home Value Loan

    Owner Occupier, Principal & Interest, LVR <70%

    1.97% p.a. variable

    1.98% p.a.

    Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Plus, $3,288 cashback offer (conditions apply).

    Discounted Home Value Loan

    Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Plus, $3,288 cashback offer (conditions apply).

    • 1.97% p.a. variable

    • 1.98% p.a.

    • $0

    • $0.00

    • $300.00

    • yes - free

    • yes - free

    • no

    • $0

    • 70.00%

    • $50,000

    • $15,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    • Receive $3,288 cashback when you refinance an existing home loan of $250,000. Must apply by 31 December 2021 and settle by 28 February 2022.

    Read our Mozo Review to learn more about the Discounted Home Value Loan

    Details Close

  • Newcastle Permanent

    1.99% p.a.
    fixed 2 years

    3.68% p.a.

    $1234

    Product details Close details
    Special Fixed Rate Home Loan Premium Plus Package

    Owner Occupier, Principal & Interest

    1.99% p.a.
    fixed 2 years

    3.68% p.a.

    Lock in a low fixed rate or choose to split your loan between fixed and variable. Insurance discounts and no fee credit card or zero fee personal loan available. $2,000 cashback offer for investor & owner occupied home loans over $250k with LVR ≤80% when refinancing to Newcastle Permanent. Limited time offer extended, T&Cs apply.

    Special Fixed Rate Home Loan Premium Plus Package

    Lock in a low fixed rate or choose to split your loan between fixed and variable. Insurance discounts and no fee credit card or zero fee personal loan available. $2,000 cashback offer for investor & owner occupied home loans over $250k with LVR ≤80% when refinancing to Newcastle Permanent. Limited time offer extended, T&Cs apply.

    • 1.99% p.a.
      fixed 2 years

    • 3.68% p.a.

    • $0

    • $395.00 yearly

    • $0.00

    • yes - free up to $25,000 p.a.

    • yes - free

    • no

    • $0

    • 80.00%

    • -

    • -

    • Fixed

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    • $2,000 cashback when you refinance your home loan from another financial institution when you apply by 31 March 2022 and are funded by 31 March 2022, min $250k, LVR <80%

    Read our Mozo Review to learn more about the Special Fixed Rate Home Loan

    Details Close

  • OneTwo

    1.99% p.a. variable

    1.89% p.a.

    $1234

    Product details Close details
    Rate Reducing Variable Rate Home Loan

    Owner Occupier, Principal & Interest, LVR <80%

    1.99% p.a. variable

    1.89% p.a.

    OneTwo’s Rate Reducing Variable Rate Home Loan brings features a low variable rate for owner-occupier refinancers. It has low fees and rewards borrowers for repaying the loan by lowering their rate. (T&Cs apply). Available to refinancers in metro NSW and Victoria only.

    Rate Reducing Variable Rate Home Loan

    OneTwo’s Rate Reducing Variable Rate Home Loan brings features a low variable rate for owner-occupier refinancers. It has low fees and rewards borrowers for repaying the loan by lowering their rate. (T&Cs apply). Available to refinancers in metro NSW and Victoria only.

    • 1.99% p.a. variable

    • 1.89% p.a.

    • $0

    • $0.00

    • $0.00

    • yes - free

    • no

    • no

    • $0

    • 80.00%

    • $20,000

    • $2,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Fortnightly, Monthly

    Read our Mozo Review to learn more about the Rate Reducing Variable Rate Home Loan

    Details Close

^See information about the Mozo Experts Choice Home loans Awards

^Based on a $300,000 variable rate, principal and interest home loan over 25 years. Average variable rate 4.35%.

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