Compare no-fee home loans

How we calculate Home Loan Finder Scores

Read full methodology

What different scores mean

9+

Excellent

These home loans offer low costs, coupled with a host of features, giving the best overall value.

7+

Great

These home loans may have slightly higher interest rates or fewer features but overall, a competitive offering.

5+

Standard

Usually the home loans would offer above average rates. They may still include some competitive features.

0+

Basic

Higher costs and/or fewer features.

What is Finder Score?

The Finder Score crunches 7,000 home loans across 120+ lenders. It takes into account the product's interest rate, fees and features, as well as the type of loan eg investor, variable, fixed rate - this gives you a simple score out of 10.

To provide a Score, we compare like-for-like loans. So if you're comparing the best home loans for cashback, you can see how each home loan stacks up against other home loans with the same borrower type, rate type and repayment type. We also take into consideration the amount of cashback offered when calculating the Score so you can tell if it's really worth it.

Read the full Finder Score breakdown

Can you really get a no-fee home loan?

Most home loans have a few fees. Lenders charge fees to cover the costs of processing applications, valuing a property or paying a conveyancer to handle settlement.

Some lenders charge a monthly fee for maintaining the loan account, especially if the loan has a 100% offset account.

But many lenders now charge minimal fees, and some genuinely charge no fees at all.

A no-fee home loan can save you money...

But a loan with a lower interest rate will probably save you even more. Always consider a loan's fees, features and interest rate.

How much can you save with no ongoing fees?

If a home loan has an upfront application fee, it will probably cost you $400–$600. But a home loan with an ongoing monthly or annual fee could cost you thousands over the life of a loan.

Here's a simple example.

Ongoing fee versus no ongoing fee

Let's compare 2 mortgages.

• Loan 1. A basic home loan with an interest rate of 6.00% p.a. and a $400 application fee.
• Loan 2. A package home loan with the same 6.00% interest rate. It has no application fee but does have a $250 annual fee.

In the end, the annual fee ends up being much more expensive over 30 years. Of course, a package home loan comes with other benefits, such as a credit card and offset account. So the fee may be worth it, depending on your needs.

How to compare home loans with no ongoing fees

• Look at all the loan fees. A lender might waive monthly or annual fees but still charge fees for offset or redraw facilities, which might add to the cost of your loan.
• Look at the interest rate. The interest rate has a much bigger impact on your loan costs than fees. A lower rate means lower interest charges. Compare the interest rate against other, similar loans to make sure you're getting a good deal.
• Look at the loan's features. Paying less in fees is good. But you should consider other features that come with the loan. Using a home loan's offset account could help you save a lot in interest charges, outweighing the cost of fees. A loan that allows for additional repayments could help you get out of debt sooner.

What other home loan fees do lenders charge?

Aside from monthly service fees and application fees, lenders often charge:

• Valuation fees. Lenders often get a professional valuation of your property before approving your loan.
• Legal fees. Lenders often charge a fee to cover their legal costs during loan settlement.
• Discharge fees. Some lenders charge you a fee when you end the loan contract.
• Break costs. This fee only applies if you exit a fixed rate loan before the fixed period ends. Break fees can cost hundreds or thousands of dollars and depend on various factors including your loan size, how much is left on your fixed period and current variable rates.

Learn more about different mortgage fees

Other fees

While your lender won't charge these fees, there are other costs you'll pay when you settle the mortgage, such as your conveyancer's fee and a mortgage registration fee that your state or territory government charges.

Expert insight: How to assess a no-fee loan

"The perfect situation for most clients is to not pay the bank fees for your home loans, but this is not always the best way to do it and the fees may be beneficial to your overall loan costs. For example, a basic home loan generally has no features. So, for low loan balances or if your loan is purely for owner-occupier purposes, a no fee loan may be the right thing for you. These generally do not have offset accounts, credit cards and other benefits like rate discounts and fee waivers. It is a pay per use model in most cases. Lenders will often not be flexible with the rate and any negotiation on this is futile. If you have a fully-featured loan, like a package, you can negotiate rates, have an offset account and receive other benefits that the lender may offer. Offset accounts are particularly beneficial for investment loans as this doesn't impact the deductibility of the loan limits. Increasingly, lenders are waiving these package fees or switching to a small monthly fee for an offset account. It is important to always communicate with your broker or bank to understand if there are more modern products available to you that may save costs. Rates can often be lower if you are willing to pay a fee, so always look at the 5,10 and 30 yr cost comparisons for each product you are interested in."

Matt Turner

Mortgage broker, GSC Finance Solutions

Do all home loans have fees?

There are actually some home loans in Finder's database that have no fees at all.

Lenders that charge no fees

• Unloan. This online lender charges no fees at all.
• Up. A mobile-only lender (you have to use the Up app), Up has no fees on its home loans.
• Athena. This online lender does not charge any fees.

There are many other lenders that have close to zero fees, but may charge a valuation fee if the valuation costs exceed a certain limit. Online lender Tiimely Home, for example, has a discharge fee when you end the home loan and a small monthly fee if you add an offset account.

More fee-free home loan questions answered

• Can you avoid all mortgage fees?

  You can find lenders that don't charge any fees at all. These are usually online lenders that have lower operating costs because they process your application digitally and don't have physical branches.

  And some lenders waive upfront fees as a promotional offer to get your business. Some lenders offer generous home loan cashbacks if you switch. The cashback can offset some of your switching costs, including the cost of loan fees.

  What you can't avoid is mortgage registration fees, which are a government fee.

• Are there any exit fees on no-fee home loans?

  Lenders can charge breaking fees if you exit a fixed rate loan before the fixed rate period ends. They cannot do this with variable rate loans.

  But lenders can charge a mortgage discharge fee. This covers the legal cost of changing the mortgage registration with the relevant state authority.

• Why do package home loans have ongoing fees?

  A package home loan lets you combine several financial products. This usually includes a home loan, a bank account (usually an offset account) and maybe a credit card. The lender typically waives most fees associated with the products in the package. In exchange you pay a single package fee every year.

• What other fees do lenders charge?

  Even if a home loan doesn't have monthly or annual fees, the lender might still charge upfront fees such as establishment/application fees, valuation fees, legal fees and settlement fees.

Why you can trust Finder's home loan experts

We're freeYou won't pay any more by taking out a home loan with us. Better still, we regularly run exclusive deals that you won't find on any other site – plus, our tables make it easy to compare loans.

We're expertsWe've researched and rated dozens of home loans as part of our Finder Awards. We provide unique insights and our in-house experts regularly appear on Sunrise, 7News and SBS News.

We're independentUnlike other comparison sites, we're not owned by a third party. That means our opinions are our own and we work with lots of home loan lenders, making it easier for you to find a good deal.

We're here to helpSince 2014, we've helped 150,000+ people find a home loan by explaining the nitty-gritty details simply and clearly. We'll never ask for your number or email. We're here to help you make a decision.

To make sure you get accurate and helpful information, this guide has been edited by Jason Loewenthal as part of our fact-checking process.

Written by

Richard Whitten

Editor

Richard Whitten is a money editor at Finder, and has been covering home loans, property and personal finance for 6+ years. He has written for Yahoo Finance, Money Magazine and Homely; and has appeared on various radio shows nationwide. He holds a Certificate IV in mortgage broking and finance (RG 206), a Tier 1 Generic Knowledge certification and a Tier 2 General Advice Deposit Products (RG 146) certification. See full bio

Richard's expertise

Richard has written 561 Finder guides across topics including:

• Home loans
• Property
• Personal finance
• Money-saving tips