2025 Australia Home Loan Refinance Comparison | Rates from 5.19% p.a.
TL;DR – Should you refinance in 2025?
- As of late 2025, sharp variable refinance rates start from around 5.19% p.a. for strong-profile borrowers.
- Many existing home loans are still sitting above 6.0–6.3% p.a., especially older packages that haven’t been repriced.
- If your rate is more than 0.5–0.7% above new-to-bank offers, a refinance quote is usually worth it.
- You must factor in application fees, discharge fees, LMI, cash-back conditions and any fixed-rate break costs.
- Always compare the comparison rate, not just the advertised rate — it includes standard fees over the life of the loan.
This article is general information only — not personal financial advice.
Why Australians are refinancing in 2025
Refinancing is not just about chasing the lowest headline rate. In 2025, borrowers are switching home loans to:
- Move from an older, high-rate package to a sharper variable or fixed split.
- Consolidate personal loans or credit-card debt into the home loan at a lower rate.
- Access equity for renovations, investment or emergency buffers.
- Restructure from interest-only investor loans into principal-and-interest over time.
At the same time, APRA and lender credit policies remain strict: serviceability buffers, genuine savings rules, LVR caps and rental income shading still apply. A refinance offer is never guaranteed — the bank will fully reassess your situation.
Sample 2025 refinance comparison (illustrative only)
The numbers below are purely illustrative, based on advertised ranges at the time of writing. Always check up-to-date product disclosure material and comparison rates from each lender.
| Lender / Type | Headline rate (from) | Comparison rate* | Key conditions |
|---|---|---|---|
| Major Bank A – Owner-occupier, P&I | 5.19% p.a. (variable) | 5.45% p.a. | Principal & interest, LVR ≤ 80%, good credit, package fee applies. |
| Major Bank B – Investor, P&I | 5.49% p.a. (variable) | 5.78% p.a. | Investment security, rental income shading, higher serviceability buffer. |
| Online Lender – Basic variable | 5.24% p.a. | 5.26% p.a. | No offset, limited branch access, digital-only service. |
| Non-bank – Specialist credit | 6.49% p.a. | 6.85% p.a. | For recent credit events, self-employed or complex income structures. |
*Comparison rate examples are for a standard loan size and term. Your rate and fees may differ.
Key costs and fees to check before you switch
- Application / settlement fees: $0–$800 depending on lender and package.
- Discharge fee from your current lender: often $200–$400 per security.
- Government registration fees: mortgage registration and discharge fees set by each state/territory.
- Fixed-rate break costs: if you’re exiting a fixed loan early, ask your current lender for a written break-cost estimate.
- Lenders Mortgage Insurance (LMI): if your new LVR is above 80%, you may need to pay new LMI or transfer may not be allowed.
- Ongoing annual package fee: often $250–$400 per year for “package” products, offset by credit-card or fee waivers.
A refinance only makes sense when the interest savings over time clearly outweigh the upfront and ongoing fees. Many borrowers run a simple 2–3 year break-even calculation before proceeding.
Step-by-step: How to refinance your home loan in Australia
- Check your current rate and balance. Log into internet banking and note your interest rate, repayment type and remaining term.
- Estimate your property value and LVR. Use recent sales or bank calculators; LVR ≤ 80% usually gives access to sharper rates.
- Get 2–3 refinance quotes. Compare advertised and comparison rates, fees, features (offset, redraw, fixed/variable split).
- Run the numbers. Use a refinance calculator to compare total interest and fees over the next 3–5 years.
- Apply and provide documents. Expect to provide payslips, tax returns, statements and ID — as if applying for a new loan.
- Valuation and approval. The new lender orders a valuation and final credit assessment before issuing formal approval.
- Settlement and discharge. Your new lender pays out the old loan and becomes the new mortgagee; your old direct debit stops.
FAQ – 2025 home loan refinance questions
1. What is a good refinance rate in Australia in 2025?
For strong-profile owner-occupiers with LVR ≤ 80% and principal-and-interest repayments, headline variable rates from around 5.19–5.39% p.a. are competitive at the time of writing. Investor and interest-only loans are usually higher.
2. How much can I save by refinancing?
As a rough guide, dropping your rate by 0.75% on a $600,000 loan over 25 years can reduce repayments by around $250–$300 per month. Actual savings depend on your remaining term, product fees and how long you keep the new loan.
3. Can I refinance if my income or living costs have changed?
Lenders must re-test serviceability based on your current income and expenses. If your income has decreased or your debts have grown, you may not qualify for the same limit. A broker or lender can run an upfront assessment.
4. Is refinancing always better than asking my current bank for a rate review?
Not always. Many borrowers start with an internal “rate review” request. If your bank won’t match competitive offers, a full refinance can make sense — provided the savings exceed costs.
5. Does refinancing affect my credit score in Australia?
A single refinance application will generally show as a credit enquiry but is unlikely to be an issue by itself. Multiple applications in a short period may be viewed negatively. Make targeted applications rather than “shopping” widely.
6. Should I fix, stay variable or split?
This depends on your risk appetite and RBA outlook. Some borrowers in 2025 use a split strategy: part fixed for certainty, part variable with offset and extra-repayment flexibility. Personal advice is recommended for this decision.
Important disclaimer
This guide is general in nature and does not take into account your personal objectives, financial situation or needs. Home-loan products, interest rates, fees and government rules change over time. Before refinancing, consider speaking with a licensed mortgage broker or financial adviser and check current information from lenders, ASIC’s Moneysmart and the Australian government websites.