What are the different types of home loan?

There are literally hundreds of home loans available, so when selecting the right mortgage, make sure you choose a product with a competitive interest rate and repayment options that match your needs.

Popular home loan categories including variable, fixed rate, split loans and interest only.

A variable rate loan is a mortgage which utilises an interest rate that generally moves in line with the cash rate determined by the RBA. So, when interest rates fall, your mortgage repayments fall. However when interest rates rise, so do your repayments.

A fixed interest rate loan protects you against interest rate changes for an agreed time. This delivers some peace of mind as your repayments won't change. However a fixed rate locks you in regardless of whether interest rates go up or down.

Split loans are simply a part fixed and part variable rate mortgage. They are popular with homeowners who want to take an each way bet on interest rates.

Interest only home loans are best used for your investment property. They offer greater control over your cash flow and can be a great asset to your investment strategy. You may find it can even provide tax and gearing benefits.