Compare Leading Fixed Rate Home Loans – April 2025

The Reserve Bank of Australia (RBA) cut the cash rate in February, leading many banks and lenders to reduce home loan interest rates. Now is an excellent time to compare the best fixed rate home loans in Australia.

What is a fixed rate home loan?

A fixed rate home loan locks in your interest rate for a set period, providing predictable repayments and protection from rate increases during that term.

Best fixed rates in the market as of April 2025

Below you’ll find the best fixed home loan rates for 1-5 year terms^, according to Mozo’s database of over 85 providers, one of the largest in Australia.

Fixed Length	Lender	Rate	Comparison Rate*
1 Year	Homeloans360	5.39% p.a.	5.62% p.a.
2 Years	Australian Mutual Bank	5.29% p.a.	6.05% p.a.
3 Years	Australian Mutual Bank	5.29% p.a.	6.01% p.a.
4 Years	Newcastle Permanent	5.59% p.a.	7.15% p.a.
5 Years	Newcastle Permanent	5.59% p.a.	7.01% p.a.

^ Rates are for owner occupiers with a 20% deposit, paying principal and interest (P&I) for a $400k property with a LVR <80%. Rates listed at 1 April, 2025.

*WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

Pros and cons of fixed-rate home loans

Fixed rates are great for some, but might not be what other borrowers are looking for. Let’s have a look at the pros and cons of fixed rate home loans.

Pros ✅

Set-and-forget repayments: Your repayments stay the same for the fixed term, making budgeting a breeze. No surprises – just consistency, so you can plan with confidence.
Shielded from rate hikes: If interest rates go up, your repayments won’t. A fixed rate means you’re protected from market fluctuations, giving you stability.
Financial certainty: You’ll always know exactly what you’re paying each month. That means no guessing games and no stress over rising interest rates.

Cons ❌

No wins if rates drop: If interest rates fall, you’re locked in at the higher rate. That means you could miss out on cheaper repayments.
Less flexibility: Extra repayments might be capped or come with fees, which could slow down your ability to pay off your loan faster.
Break costs can sting: Want to refinance, sell, or make a big lump-sum repayment before the fixed term ends? You could be hit with some hefty fees, so it’s worth knowing the terms and conditions of your loan.

"Opting for a fixed rate loan means locking in stability and shielding yourself from interest rate hikes, albeit temporarily. However, the trade-off is that you won’t benefit if rates drop, and you may have less flexibility when it comes to making extra repayments or refinancing.”

– Mozo senior money writer Peter Terlato

Can you break a fixed rate home loan early?

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Fixed vs variable

Feature	Fixed rate home loan	Variable rate home loan
Interest rate	Stays the same for a set period (typically 1-5 years), regardless of market changes.	Fluctuates based on market conditions, usually following changes to the RBA cash rate.
Repayments	Predictable and consistent throughout the fixed term, making budgeting easier.	Can increase or decrease, which means potential savings if rates fall but higher costs if they rise.
Flexibility	Limited flexibility – extra repayments may be capped or come with fees. Refinancing or switching loans during the fixed term can also be costly.	More flexible – allows unlimited extra repayments, offset accounts, and the ability to switch loans without break fees.
Risk	Lower risk in the short term – you're protected from interest rate hikes but won’t benefit from rate drops.	Higher risk – rates can rise unexpectedly, increasing repayments, but you could also benefit if rates fall.
Early repayment	May come with break fees if you refinance, sell, or pay off your loan early.	Generally no penalties for making extra repayments or paying off your loan early.
Suitable for	Borrowers who want certainty in their repayments and protection from rising interest rates. Ideal for those on a strict budget.	Borrowers who are comfortable with rate fluctuations and want flexibility to make extra repayments, use offset accounts, or refinance easily.

Learn more reading our in depth fixed vs variable rate guide

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How to find the best fixed rate home loan

Choosing between a fixed or variable rate home loan? Here’s how to compare your options and find the best fit for your financial situation.

1. Understand your borrowing needs

Before comparing loans, work out what you need:

Loan amount: How much do you plan to borrow?
Loan term: Are you looking for a shorter or longer repayment period?
Key features: Do you want flexibility (e.g. extra repayments, offset accounts), or do you prefer repayment certainty?

2. Compare interest rates and loan types

Once you know what you're looking for, compare:

Fixed vs. variable interest rates – Fixed loans lock in your rate, while variable loans fluctuate with the market.
Fixed period – Typically 1-5 years, but some lenders offer longer terms.
Loan features – Variable loans often allow extra repayments, redraw, and offset accounts, while fixed loans may have restrictions.

3. Factor in all fees and charges

A low interest rate is great, but don’t overlook fees, including:

Application and establishment fees
Ongoing service fees
Break costs if you refinance or pay off your fixed rate loan early
Discharge fees when closing your loan

4. Weigh up flexibility vs. stability

Think about how important flexibility is to you:

Fixed rate loans offer repayment certainty but limit extra repayments and refinancing options.
Variable rate loans allow more freedom but can be unpredictable if rates rise.
Split loans offer a mix of both, giving some stability while keeping some flexibility.

5. Read the fine print

Carefully review the terms and conditions before committing. Look out for:

Fixed rate conditions – Can you make extra repayments? What are the break costs?
Variable rate changes – How often does the lender adjust rates?
Package deals – Some loans offer discounts on rates or fees when bundled with other financial products.

6. Get pre-approved

Pre-approval helps you understand how much you can borrow and gives you confidence when house hunting. Lenders will assess your:

Income and employment
Credit history
Existing debts and expenses

7. Apply for your home loan

Once you've chosen the right loan, you can apply online or through a mortgage broker. The lender will:

Review your application and supporting documents
Conduct a property valuation
Issue conditional approval, then final approval once all checks are complete

After approval, you’ll receive loan documents to sign, and settlement will be arranged.

Fixed home loan FAQs

What is a fixed rate home loan?

A fixed rate home loan is a mortgage where the interest rate stays the same for a set period, typically between one and five years. During this time, your repayments remain unchanged, providing certainty and making it easier to budget. Once the fixed period ends, the loan usually reverts to a variable rate unless you choose to re-fix or refinance.

What happens at the end of my fixed rate period?

Once your fixed rate term expires, your home loan will usually revert to a variable rate set by your lender. This new rate may be higher or lower than your fixed rate, depending on market conditions. You may have the option to:

Refix your loan for another term (if your lender offers it).
Refinance to a different loan with a new lender.
Stay on the variable rate and benefit from greater flexibility.

Can I make extra repayments on a fixed rate loan?

Some fixed rate home loans allow extra repayments, but there are often limits on how much you can repay each year. If you exceed the limit, you may incur fees or break costs. Always check with your lender before making extra payments.

What are break costs?

Break costs are fees charged by lenders when you exit a fixed rate home loan before the fixed term ends. These costs can be high and are calculated based on:

The remaining fixed term on your loan.
The difference between your fixed rate and the current market rate.
The amount you have left to repay.

How do I compare fixed rate home loans?

When comparing fixed rate home loans, consider:

Interest rate and fixed term options: Look at different fixed periods and compare rates.
Loan features: Check if the loan allows extra repayments, redraw, or offset accounts.
Fees and charges: Compare upfront fees, ongoing fees, and break costs.
Reversion rate: Find out what rate your loan will revert to once the fixed period ends.

Can I break a fixed rate home loan early?

Yes, but it may come with break costs, which can be expensive. If you’re considering refinancing or paying off your fixed loan early, make sure you understand the potential fees involved.

Can I get extra features on a fixed rate home loan?

While fixed rate home loans generally have fewer features than variable loans, some lenders do offer:

The ability to make extra repayments (though limits and fees may apply).
A redraw facility for extra repayments (may have restrictions).
An offset account (may come at an extra cost or have a capped balance).
Choice of repayment frequency (weekly, fortnightly, or monthly).
Split loan options, allowing you to fix part of your loan while keeping the rest variable.

Disclaimer

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Compare fixed home loan rates

What is a fixed rate home loan?

Best fixed rates in the market as of April 2025

Pros and cons of fixed-rate home loans

Pros ✅

Cons ❌

"Opting for a fixed rate loan means locking in stability and shielding yourself from interest rate hikes, albeit temporarily. However, the trade-off is that you won’t benefit if rates drop, and you may have less flexibility when it comes to making extra repayments or refinancing.”

– Mozo senior money writer Peter Terlato

Fixed vs variable

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How to find the best fixed rate home loan

1. Understand your borrowing needs

2. Compare interest rates and loan types

3. Factor in all fees and charges

4. Weigh up flexibility vs. stability

5. Read the fine print

6. Get pre-approved

7. Apply for your home loan

Fixed home loan FAQs

Peter Terlato

JP Pelosi

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Important disclosures

Disclaimer

Who we are and how we get paid

Disclaimer

Important information on terms, conditions and sub-limits

Book an appointment with Aussie and
enter the draw to win a share of $320K (T&Cs apply)

Book an appointment with Aussie and
enter the draw to win a share of $320K (T&Cs apply)