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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.
Read our Mozo Review to learn more about this Unloan Unloan Variable
Go to siteBuilt 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.
Read our Mozo Review to learn more about this Unloan Unloan Variable
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Enjoy a low variable rate with no application, ongoing or monthly fees to pay. Access your money via internet banking at any time with free redraws. Make additional repayments at any time. Available for owner occupied, investment and interest only repayments.
Read our Mozo Review to learn more about this First Option Bank Simple Home Loan Variable
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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.
Read our Mozo Review to learn more about this Macquarie Basic Home Loan
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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.
Read our Mozo Review to learn more about this ING Mortgage Simplifier
Compare 25+ lenders with our trusted partner, Lendi.
Talk to one of their experienced home loan specialists by answering a few questions online.
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.
Read our Mozo Review to learn more about this Macquarie Offset Home Loan
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What makes a variable rate different from, say, a fixed rate home loan, is that the interest rate goes up and down over time.
For example, one month your variable rate might 5.50%, and then it could change to 5.75% the next. While that’s a big change, plenty of Aussie borrowers have experienced big shifts like that in their home loan interest rates over the past few years.
Variable rates are heavily tied up with the cash rate.
The cash rate is the official interest rate set by the Reserve Bank of Australia (RBA) and influences how much it costs a lender to borrow money, either from the RBA or from each other.
When the cash rate goes up, the RBA makes it more expensive to borrow money, which means lenders charge borrowers more, to maintain their profits.
When the cash rate comes down, the RBA makes it cheaper for lenders to borrow money, and variable home loan rates tend to drop.
Borrowers with a fixed rate home loan won't be affected by the RBA cash rate in the same way, as their rate is locked for the duration of their fixed term.
Variable rate home loans are among the more popular types of mortgages in Australia, which isn’t surprising when you consider the array of interest-saving features commonly available.
When you compare variable home loans, keep an eye out for features like:
One of the most important features of variable home loans are the interest rates. Your interest rate will determine how much your monthly repayments will be, so find a home loan with a competitive rate. Pay attention to the comparison rate, since this is a more accurate number for cost calculations.
A common feature of variable home loans, the ability to make unlimited additional repayments means you can pay off more of your loan quicker, without being penalised.
If you end up making additional repayments and suddenly find yourself needing that extra cash, then a variable home loan with a redraw facility will allow you to withdraw those extra repayments. Some lenders offer free, unlimited redraws, while others will put caps or attach fees for redrawing your funds.
Some variable home loans come with offset accounts, which are essentially transaction accounts that are linked to your home loan. The idea is that whatever money you store in your offset, is subtracted from your loan amount before you’re charged interest on it.
This can help reduce the amount of interest you are charged on your home loan, because if you’ve got a $500,000 home loan, and $20,000 in your offset account, interest is only calculated on $480,000 of your remaining balance.
Add up ongoing or upfront fees like application or property valuation fees and compare them with your interest rate. Sometimes, you are better off paying a small ongoing fee to get a lower interest rate.
The fact of the matter is, lenders are much more likely to offer you a low variable rate home loan if you’re a safe bet – meaning, you’ve got a stable income, good credit history, are a diligent saver, and don’t spend recklessly.
In short, they want to you borrow money from them, so long as you can pay it back.
If you’re looking for cheap home loans, here are some tips to help you find what you’re after:
Your first port of call when finding a low variable home loan rate is to see your options. Simply type in how much you want to borrow and how much the property is worth and hit search.
Comparing can help you shortlist a few lenders with low rates before you decide to apply for the first one you see.
A less obvious hack to getting a lower variable rate home loan is to compare smaller lenders with rates from the Big Four banks.
For instance, the average variable rate† in the Mozo database for non-Big Four home loans comes in at 6.77% p.a. In contrast, the average Big Four variable rate† is 7.31% p.a. On a $400,000 home loan, this equates to a difference of $138 per month, or $41,402 over 25 years.
So, there’s some merit in digging for more competitive variable rates from lenders outside of the Big Four.
Lenders prefer borrowers with at least a 20% deposit, as it not only proves that you’re a good saver with a stable income, but it means you’re already a fifth of the way to paying off the property.
Your deposit amount will also place you into a specific loan-to-value ratio (LVR) tier. These LVR tiers often advertise lower rates for those with LVRs below 80% (i.e. those with a 20% deposit). In general, the lower your LVR is, the lower the variable rates you can access.
For example, the lowest variable rate home loans on average† are available for those with 60% LVRs, according to the Mozo database, while the highest are available for those in the 95% LVR tier.
| LVR tier | Average variable rate† |
| 60% LVR | 6.72% p.a. |
| 70% LVR | 6.76% p.a. |
| 80% LVR | 6.80% p.a. |
| 90% LVR | 7.08% p.a. |
| 95% LVR | 7.35% p.a. |
Variable home loans are the most popular type of home loans in Australia. Most banks, lenders, and credit unions will have a number of variable home loan deals to choose from. Options may include:
Sometimes called “honeymoon” rate loans, these offer a low variable rate for an initial set period (usually 1-3 years) which reverts to the loan’s standard variable rate once the introductory period ends. Always compare using the revert rate, not the introductory rate.
If you don’t need bells and whistles like an offset account or unlimited free extra repayments, then a basic home loan could be a good money saving option.
A full feature home loan is a loan that has flexible features like an offset account, free extra repayments, and a free redraw facility. You might pay an annual or monthly service fee.
If you’re borrowing over $150,000 you may qualify for a packaged home loan, where you get a lower interest rate if you bundle other products like a credit card and bank account with your home loan provider. This usually comes with an annual package fee, but the rate discounts can be enormous.
This usually refers to a 'reference rate' that the provider uses to calculate margins for the rates applied to the rest of their variable rate loan options. Standard variable rates are not restricted by LVRs or loan amount. These usually include features like offset accounts and split loan rates.
†Average variable rate in the Mozo database on a $400,000 home loan for an owner occupier, paying principal and interest, with <80% LVR. Correct as at 5 July 2024.
Your variable rate will often change by your loan-to-value (LVR) tier. Lower LVR tiers tend to get lower interest rates because the borrower has more security built into the loan: this makes lenders see them as less risky, therefore they get lower rates.
Fixed and variable rate home loans will have their pros and cons. As a borrower, it’s important not to review all options carefully and choose one that is going to best suit your financial situation or comfort level.
Variable rates tend to follow the fluctuations of the broader economy. If rates drop, so will your repayments. If rates rise, so will your repayments.
This is exemplified whenever the Reserve Bank of Australia (RBA) changes the official cash rate. Many lenders follow suit by passing the full cut or a partial change onto your home loan.
The key reason to take out a full feature home loan is to benefit from more flexibility in how you make your repayments, which could also help you budget better and save on interest.
Full feature home loans often include an offset account facility, an unlimited number of free extra repayments, and free redraws.
An offset account is a transaction and/or savings account linked to your home loan. Having this type of account means you could pay less interest on your home loan.
For example, if you have $400,000 left on your home loan and $200,000 in a 100% offset account, you would only pay interest for $200,000 of your loan.
There are many lenders with sharp variable rates, especially online lenders.
However, while a great rate is a good thing to chase, it's also good to make sure you’re getting all the features and flexibility you need. So when you’re comparing home loans, make sure you’re comparing the whole package, including price, features and flexibility.
If you're looking for one of the most competitively priced variable rate home loans in Australia, then our annual Mozo Experts Choice Home Loan Awards is a good place to start your search.
Mozo's market snapshots, mortgage calculators, and home loan database are all useful tools to help you compare and crunch costs for variable home loans.
If you want to delve deeper and compare all the home loans in our database (over 400 home loans), use our home loan search tool which will find options based on your requirements including interest rate type, your borrowing size and the value of your property.
If you want more information to help you make an informed decision, head on over to our guides section.
Learn what you need to know about mortgages, including tips and traps, in our helpful guides. See all
Get the latest on property market trends, interest rates, and lending news from Mozo's expert writers. See all
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We compare home loans from the following well-known lenders and many more... SEE MORE HOME LOAN LENDERS
These people are merciless. They have no care of concern for their customers. They also have no interest in helping or negotiating with you if you have less than a 1 million dollar loan with them. With a mortgage of $475K, I was told that I was an "easy loss" for the bank.
Read full reviewThese people are merciless. They have no care of concern for their customers. They also have no interest in helping or negotiating with you if you have less than a 1 million dollar loan with them. With a mortgage of $475K, I was told that I was an "easy loss" for the bank.
I like Suncorp Bank for a few key reasons. First, they offer a wide range of financial services, from home loans and savings accounts to insurance. It’s convenient having everything in one place. I’ve also found their interest rates to be pretty competitive, especially for home loans and savings accounts, which is important to me. Their customer service has been a positive experience, and I find their online and mobile banking platforms easy to use. It’s quick and simple to manage my accounts, pay bills, and transfer money. On the downside, I’ve noticed that some of their accounts have higher fees compared to other banks. This can be frustrating if you're not careful about which account you choose. Also, their branch network is somewhat limited, so if you prefer going into a branch for banking, it might not be the most convenient option depending on where you live. Another thing to watch out for is that while their interest rates are competitive, they can fluctuate, which might not always be in your favor. Lastly, the loan approval process can sometimes be slower, which can be a hassle if you’re applying for a home loan. If you’re thinking about Suncorp, I’d say the product variety and competitive rates are great, but definitely look at the fees and make sure there's a branch near you if that’s important.
Read full reviewI like Suncorp Bank for a few key reasons. First, they offer a wide range of financial services, from home loans and savings accounts to insurance. It’s convenient having everything in one place. I’ve also found their interest rates to be pretty competitive, especially for home loans and savings accounts, which is important to me. Their customer service has been a positive experience, and I find their online and mobile banking platforms easy to use. It’s quick and simple to manage my accounts, pay bills, and transfer money. On the downside, I’ve noticed that some of their accounts have higher fees compared to other banks. This can be frustrating if you're not careful about which account you choose. Also, their branch network is somewhat limited, so if you prefer going into a branch for banking, it might not be the most convenient option depending on where you live. Another thing to watch out for is that while their interest rates are competitive, they can fluctuate, which might not always be in your favor. Lastly, the loan approval process can sometimes be slower, which can be a hassle if you’re applying for a home loan. If you’re thinking about Suncorp, I’d say the product variety and competitive rates are great, but definitely look at the fees and make sure there's a branch near you if that’s important.
My home burnt down in March this year.I still have a mortgage with Comm Bank.The insurance company have been dragging out payment,which has left me financially compromised. Comm bank have been very supportive during this crisis and have provided me with hardship plans.They have been amazing.People be aware of NRMA insurance.I have paid money for over 50 years,never made a claim and since the fire they have turned ,are nasty and trying every trick in the book not to pay the policy,which is still ongoing I am 71,I think they hope I will die from the stress
Read full reviewMy home burnt down in March this year.I still have a mortgage with Comm Bank.The insurance company have been dragging out payment,which has left me financially compromised. Comm bank have been very supportive during this crisis and have provided me with hardship plans.They have been amazing.People be aware of NRMA insurance.I have paid money for over 50 years,never made a claim and since the fire they have turned ,are nasty and trying every trick in the book not to pay the policy,which is still ongoing I am 71,I think they hope I will die from the stress
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