Mozo guides

What is a package home loan?

Couple with home loan outside their house

Taking out a home loan can be a pretty clear cut deal focused solely on securing financing to help you purchase property. But if you want to sort out a few other financial needs with the same institution, you might consider a packaged home loan.

Many lenders present packages as a way for customers to save money across the life of their mortgage, alongside other financial products. An interest rate discount is on the table, along with more cost-saving features than a ‘no frills’ home loan, in exchange for you signing up to a bundle deal of the institution’s other products like credit cards, insurance or savings accounts

It sounds pretty swish, but it’s super important to consider all the loan costs, the additional features and discounted interest rate and size it up against other home loan types. Then compare this to the overall cost of holding the extra financial products separately or with other institutions. It may be convenient to have everything in one package, but it’s not automatically the most affordable option, even with the discounted interest rate.

Once you’ve done your mathematical due diligence, then you can check out the packaged home loan options below.

What can a packaged home loan offer?

Packaged home loans can come as fixed or variable, and interest rate discounts are often advertised as part of the deal. As is the case with basic home loan options, the variable option will generally offer more flexible features. This most commonly includes things like fee-free extra repayments and redraws, and access to an offset account.

Every package is different, but there are some common features and bundled products you’ll often see popping up, sometimes at discounted rates or with fees scrapped. These can include:

Are there fees for packaged home loans?

Yes. You’re slightly more likely to see an annual fee on a fixed or variable package home loan than the basic offers, and it’s commonly higher. 

Some institutions will offer discounts or fee-waivers on the other bundled financial products in your package and rationlise this single ongoing fee as covering overarching service costs. When you’re calculating whether or not a packaged home loan will suit your circumstances, ensure the annual fee and any upfront costs do not outweigh the savings you might make on the discounted interest rate and products.

Like other home loans, you could also incur a discharge fee when you settle your home loan or choose to refinance with another lender.

How does a package loan save you money?

There are a few avenues where taking out a packaged home loan could potentially save you money. These include:

Discounted interest rates
Packages are often advertised with a discount interest rate across variable and fixed options. If that rate is competitive in the market, then you could see savings across the life of your loan.  

Average interest rates* Packaged Unpackaged
Variable 3.22% p.a.. 3.40% p.a.
3-year Fixed 2.47% p.a. 2.64% p.a.

Product bundling: Discounts and fee waivers

If you were already in the market for a credit card, insurance policy or a new savings and transaction account, then setting these up via a packaged home loan could be cost-effective. As always, you’ll need to scan the market to see how these offerings compare and ensure any discounts or annual fee waivers being offered outweigh the broader fees associated with the packaged home loan.

Pros and cons of a packaged home loan


  • Discounted interest rates
  • Potential discounts on other products and services
  • Access to cost-saving features like an offset account
  • Convenience of having all financial services with one institution


  • Large annual fees are common
  • Discounted rate may not outweigh other costs
  • Bundled services may not be the most competitive on the market (or you may not actually need/use them)

To assess the full scope of home loan offers on the market, head to Mozo’s home loan comparison page.

*Based on the home loan offerings in Mozo’s database for owner occupiers paying principal and interest on loans of $400,000 with an 80% LVR. Correct at the time of writing (August 20, 2020).

Olivia Gee
Olivia Gee
Money writer

As a personal finance writer at Mozo, Olivia investigates insurance, banking and property. After completing a double degree in journalism and media and communications, Olivia became a lifestyle editor at Time Out Sydney and freelanced for notable publications such as Guardian Australia and SBS News. Now she is Mozo’s resident car insurance enthusiast, and is certified (ASIC RG146 Tier 2) to provide general advice in general insurance. She also creates audible finance adventures as co-host of Mozo’s podcast, The Finance Burrito.

* 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.

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