Mozo guides

Choosing a home loan lender

From the big bank players to the small online only lenders, the mortgage world offers plenty of choice when it comes to selecting a home loan lender.

As there’s no one size fits all, deciding which home loan lender ticks the boxes for you isn’t always an easy choice.

Let us help you pick your match, with this rundown on the different types of home loan lenders in Australia:

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 15 June 2024 Important disclosures and comparison rate warning*
  • Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    6.25% p.a.
    fixed 3 years
    6.20% p.a.

    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.

  • Variable Home Loan 90

    Principal and Interest, LVR <90%

    interest rate
    comparison rate
    Initial monthly repayment
    6.04% p.a. variable
    6.06% p.a.

    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.

  • The Better Home Loan Special Offer

    Owner Occupier, Principal & Interest, LVR<80%

    interest rate
    comparison rate
    Initial monthly repayment
    6.14% p.a. variable
    6.14% p.a.

    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.

  • Discount Variable Home Loan

    Owner Occupier, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    5.99% p.a. variable
    6.01% p.a.

    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^


Major banks

Often your first thought when it comes to choosing a home loan lender might be the familiar faces of the major banks like Westpac, CommBank, ANZ and NAB. But it’s important to keep in mind the big players are known for charging higher interest rates and fees than smaller providers, as they have to cover costs like branches, bank managers and paying dividends to shareholders.

However, there are some positive aspects of banking with a major. For instance, big banks often have competitive bundling offers, which means if you’re willing to bundle your home loan with other banking products like your credit card, you could be handed a home loan with a lower rate and some of the fees may be wiped.

Another reason that many Aussies take out a home loan through a major bank is because of the branch accessibility, which means you can meet with a branch manager at each stage of the home loan process. You’ll also have access to a wide ATM network, an important feature for home loan borrowers taking out a mortgage with an offset account and can take advantage of the major bank’s free smartphone apps, which make banking on the go a breeze.

Here are some the major players in Australia:

  • CommBank: The Commonwealth Bank is Australia’s biggest bank and has the philosophy of “When you believe you CAN”. CommBank offers products across the banking arena including bank accounts, savings accounts and credit cards and it’s also one of Australia’s largest life insurance providers. When it comes to home loans, CommBank has packages including 1 to 10 year fixed rate loans, as well as variable, no fee and line of credit loans.
  • ANZ: This major big four player has been around for yonks with roots in Australia dating back over 180 years. ANZ is not only a big bank in Australia, as it is also the largest banking group in New Zealand and the Pacific. Its home loan range includes both fixed and variable rates, as well as a line of credit loan in the form of its Equity Manager.
  • NAB: The National Australia Bank has over 12,700,000 customers, making it another big four player. There are a number of providers that fall under NAB’s umbrella, including MLC Financial Planning, Bank of New Zealand, Yorkshire Bank and Great Western Bank. NAB has a range of home loan packages, such as variable, fixed and interest only mortgages.
  • Westpac: The last of the big four banks is Westpac, servicing around 13 million customers. Westpac owns a range of banks, including St. George, Bank of Melbourne, BankSA and RAMS all offering varying home loan packages. When it comes to Westpac's mortgage packages you’ll be able to choose between fixed and variable rates, honeymoon rate loans and line of credit loans.

The big four aren’t the only major players downunder, here are some of the other big banks to choose from:

  • St. George: The green logo'd St.George originally started as a small building society in 1937 and didn’t become a bank until 1992. St. George Bank merged with Westpac in 2008 and currently has around 2.6 million consumers and more than 5,700 staff. Its home loans start from the Basic Package with a low rate and fees to the Portfolio Loan that allows homeowners to access their equity through a line of credit facility.
  • Suncorp Bank: This major is part of the Suncorp Group, which is the largest provider of insurance policies to Australians. With origins dating back to 1902 in Queensland, Suncorp Bank today has 200 branches and 2000 ATMs located throughout Australia and offers a great range of home loans available across fixed and variable rates.

To see more big home loan players, head on over to our major banks comparison section.

Mutuals, credit unions and building societies

If you want to look outside the big banks, then a popular choice is going for a challenger brand like a mutual bank, credit union or building society that works around the philosophy of returning profits to members. When you take out a home loan through one of these providers you will need to pay a small membership fee, which is around $10.

The major benefit of taking out a home loan through a mutual or credit union is that you will generally receive much lower rates and fees than with a big bank. This is because they don’t have to pay dividends to shareholders and can instead return profits to members (i.e customers) in the form of more competitive home loan deals.

Here are some of the customer owned lenders that provide home loans in Australia:

  • Community First Credit Union: This member owned home loan provider has been around for over 50 years and is the largest credit union around Sydney and the Central Coast area with 76,000 members. Its fixed rate home loans are available for 1-3 years and it also offers variable rates with a honeymoon option.
  • Qantas Credit Union: Launched in 1959 by a group of Qantas employees, the QANTAS Credit Union is now one of Australia’s largest credit unions with around 90,000 members. While the credit union offers all the standard home loan options - fixed, variable - its Qantas Points Home Loan stands out from the pack with a unique feature of offering Frequent Flyer Points on a portion of the home loan balance each year.
  • Greater Building Society: Around since 1945, today the Greater Building Society has approx 250,000 customers and offers the largest branch network of any Australian Building Society with over 3000 ATMs nationwide. Its home loans cover fixed, variable, and line of credit loans.

Online only lenders

Are you comfortable with applying for a home loan and managing it day to day via the internet? Then an online only home loan could be just for you. Without the cost of paying for bricks and mortar outlets, these challenger brands can afford to offer more competitive rates and lower fees to customers.

If you’re considering taking out a home loan through an online only lender, it’s a good idea to read the experiences of other home loan customers just like you to see whether the provider offers the goods when it comes to everything from customer service to convenience.

It’s also important to think about the features you are looking for in a home loan. For instance, many online only providers don’t offer loans with a revolving line of credit. And if you want to take out a home loan that comes with an offset account, it’s wise to check that the online provider you sign up with has a generous ATM network. For example’s Offset Variable home loan offers 5 free transactions every month via the Westpac, St.George, Bank SA and CueCard ATM networks.

Let’s run through some of the online only lenders that offer competitive home loan deals:

  • With an Australian call centre in Brisbane and your own lending manager throughout the entire home loan process, has become a popular online only lender downunder. In fact, it impressed Mozo’s judges enough to take out the 2015 Home Lender of the Year. Choose between a fixed rate loan, standard variable rate loan or a variable rate loan with an offset account attached.
  • Click Loans uses its online only platform to offer chat, talk, message or video calls at anytime the customer wants. It also offers a quick 8 question rate quote that they say generally takes less than 60 seconds. Click Loan’s competitive home loan rates are available to borrowers who have a loan to value ratio of at least 80%.
  • State Custodians: This online only lender has funded over $1 billion home loans. There’s a large range of loans from line of credit loans to loans with an offset facility

Finding a home loan

No matter which lender you decide to go with, when choosing a home loan you should look for one that has the following:

Competitive interest rate: A low interest rate can make a significant difference to the amount of interest you’ll pay in the long run. For instance, the difference between a 4% and 4.5% interest rate on a $300,000 home loan over 25 years is $25,196. You should also look at the comparison rate when comparing home loans, as this merges the headline rate with some of the common fees (e.g application and ongoing fees). This will quickly show you if the loan is still a competitive deal once the fees are added to the equation.

Low fees: Home loans can come with a range of fees attached like an application fee that you pay upfront, an ongoing monthly service fee or a break cost fee (on fixed rate loan). So don’t forget to check what the associated fees are, to ensure you’re not only receiving a great rate but low fees as well.

Flexible features: Look for a mortgage package that comes with features that will help you pay off your home loan sooner like an extra repayments facility or offset account. Fee free extra repayments mean you can pump additional cash into your home loan whenever you please (AKA when you receive that well deserved promotion). Alternatively a home loan that comes with an offset account could be for you, which offsets any money you have in the account daily against your home loan principal. For a full rundown on the home loan features to look for, read our Home loan features in a nutshell guide.

Want to compare over 100 home loans in our database right now? Punch in your numbers into our home loan comparison tool to begin your search.


* 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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