Buying guide
What are home loan interest rates and how do they work?
A quick, jargon-free guide to the cost of borrowing.
AI summary
A home loan interest rate is the cost of borrowing money to buy a property. Rates are influenced by your loan size, loan term, and the Official Cash Rate (OCR) set by the Reserve Bank.
Borrowers can choose between two main types:
- A fixed rate offers certainty, locking in your repayment amount for a set term.
- A floating rate moves with the market, so your payments could increase or decrease.
You can also split your loan across both types.
What you’ll learn:
What are home loan interest rates, and why do banks charge them?
You need to be aware of home loan interest rates when budgetting for your home.
How are mortgage interest rates calculated?
You'll need to decide if you'd prefer a fixed or floating interest rate.
Fixed and floating interest rates explained
Floating interest rates
Fixed interest rates
A bit of both
Author
Search
Other articles you might like
