Getting a better rate

The loan with the cheapest interest rate is not always the right option, and in some cases may actually cost you more money over the loan term.


A competitive home loan will offer a combination of competitive rates, low fees and loan flexibility.

Interest rate options
Interest rates are a major consideration for borrower’s when making a decision to refinance, so it’s important to understand how they work

Most borrowers are aware there are two types of interest rates: variable and fixed. Each type is based on different financial market indicators: variable rates are driven predominantly by Reserve Bank policy while fixed rates are driven by the predicted trends in the wholesale money market.

Comparison rates
The comparison rate, or Annualised Average Percentage Rate (AAPR), of a loan can be a useful indicator of the overall costs you will have to pay over your loan term. It takes into account upfront fees, honeymoon rates, ongoing fees, different compounding periods and other factors to produce an average yearly interest rate that reflects the overall cost of your loan.

It’s important to note that while useful, even a comparison rate will not show all the costs associated with your loan. A Loan Market mortgage adviser will discuss other items that may not be included or cannot be accurately reflected in the comparison rate calculation which include; occasional and one-off charges such as redraw fees, exit fees and penalties; loan features such as portability; and non-standard loan terms and loan amounts.

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