The best way to compare home loans is to line up three realistic options and compare their total cost over the period you expect to keep the loan. The three options are usually: stay with your current lender and ask for a lower rate, refinance to a competitive variable loan, or refinance to a fixed or split loan if certainty matters. For each one, include the interest rate, the comparison rate, upfront and ongoing fees, switching costs and the features you will genuinely use.
Then check policy fit. A loan that looks cheapest on paper still has to pass the lender’s credit assessment, and lenders assess repayments at least 3 percentage points above the loan rate (APRA APG 223, checked October 2026).
Why compare home loans now?
Rates have moved. The RBA lifted the cash rate target to 4.60% on 30 September 2026 (RBA). When rates rise, the gap between what existing customers pay and what new customers are offered can matter more, so it is a sensible time to check where your loan sits.
Need the numbers checked before you switch? Run the loan comparison calculator or start a refinance enquiry.
How do you compare and switch home loans in 5 steps?
- Write down your current balance, rate, remaining term, fees and features.
- Ask your current lender for a lower rate and record the exact offer.
- Shortlist a variable option and a fixed or split option from other lenders.
- Compare total cost over 3 and 5 years, including switching costs.
- Check policy fit and repayment comfort before you apply.
Moneysmart’s guide to switching home loans walks through the switching process and costs (checked October 2026).
What are the four pillars of a good comparison?
Most comparisons online only look at rate. A decision-ready comparison covers four things:
- Pricing: interest rate and comparison rate.
- Cost structure: upfront, ongoing and switching costs.
- Feature value: offset, redraw, extra repayments, splits.
- Policy fit: whether the lender will actually approve you.
Miss one and the “cheapest” option can quickly become the wrong one.
How should you compare pricing?
Start with the advertised rate and the comparison rate, then ask your current lender what they will reprice to. Never compare one loan’s headline rate against another loan’s full package without normalising fees and features. The home loan rates comparison guide explains how comparison rates work and where they fall short.
Then test the repayments in the mortgage repayments calculator.
What costs should you include?
Include:
- Annual or monthly package fees.
- Application, valuation and settlement costs on the new loan.
- Discharge and government registration costs on the old loan.
- Break costs if you are leaving a fixed rate early.
If an option has a lower rate but a higher total cost over your hold period, it is not the better option. Moneysmart’s mortgage switching calculator can help check whether savings outweigh costs (checked October 2026).
Which features are worth paying for?
Features only have value if you use them. An offset account reduces the balance you pay interest on (Moneysmart, checked October 2026), but it is only worth a higher rate or package fee if you keep enough savings in it. Keep features that improve your outcome and drop ones that add cost without being used.
Why does lender policy fit matter?
A loan can look perfect on paper and still fail at assessment. Lenders differ on:
- How they treat casual, bonus, overtime and self-employed income.
- How they assess living expenses.
- How they count existing debts and credit card limits.
- Which property types and locations they accept.
This is why a good comparison includes realistic screening against lender policy before you apply, rather than after a decline.
What does a 3-option comparison grid look like?
Instead of comparing only “current” against “new”, score three options side by side.
| Option | What it means | Main upside | Main watch-out |
|---|---|---|---|
| A: Stay and reprice | Ask your current lender to lower your rate | No switching costs or new application | Structure problems stay unsolved |
| B: Refinance to variable | Move to a competitive variable loan, often with offset | Flexibility and potential rate saving | Switching costs and a full credit assessment |
| C: Refinance to fixed or split | Lock all or part of the loan | Repayment certainty on the fixed portion | Break costs and limits on extra repayments |
For each option, record the monthly repayment, the 3-year and 5-year total cost, a feature-fit score and your confidence in policy fit. Choose the option that balances cash-flow comfort and long-term cost.
Should you choose fixed, variable or split in 2026?
There is no universal answer. Moneysmart’s fixed vs variable guide sets out the trade-offs (checked October 2026).
When does a variable loan suit?
Variable suits borrowers who want flexibility, unlimited extra repayments and an offset account, and who can handle repayments moving with rates.
When does a fixed loan suit?
Fixed suits borrowers who value repayment certainty for a set period. Break costs can apply if you exit early, and features may be limited.
When does a split loan suit?
A split suits borrowers who want some certainty and some flexibility. Review it regularly so the split still matches your plans.
What mistakes do people make comparing home loans?
- Choosing on headline rate alone.
- Ignoring switching and setup costs.
- Treating all offset and redraw setups as the same.
- Assuming policy fit without checking lender rules.
- Comparing options without a defined hold period.
- Skipping a stress test at a higher rate.
Does comparing matter more for Sydney borrowers?
Sydney loan sizes are often larger, so a small rate or fee gap translates into more dollars each year. That makes it worth comparing with a clear hold period, a conservative stress test and realistic assumptions about which features you will use.
When is it worth using a broker to compare?
A broker-led comparison is most useful when:
- Your income is variable, self-employed or complex.
- You are buying and need to move quickly.
- You are balancing a home loan with investment plans.
- You want to avoid multiple applications that each leave a credit enquiry.
The broker vs bank guide explains the difference in more detail. When you are ready, NewGen can build a comparison grid and lender shortlist for you through our home loan service or refinancing review. Lending criteria, fees and charges apply, and all loans are subject to lender approval.