Best variable rates – turn on the offset

How we calculate Home Loan Finder Scores

Read full methodology

What different scores mean

9+

Excellent

These variable rate 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 variable rate home loans, you can see how each product stacks up against other variable rate loans with the same borrower type and repayment type.

Read the full Finder Score breakdown

How to compare variable rate home loans

Don't settle for a third-rate home loan. Make sure you get the best variable rate home loan deal by looking at 4 things:

1. The interest rate

The interest rate determines how expensive your repayments will be. The lower the rate, the better.

2. Fees

Most home loans have some fees, but some have almost none. The key ones to watch out for are application fees, monthly fees and settlement fees.

3. Loan purpose

If you're looking to finance an investment property then you will need an investment loan.

If you're buying (or refinancing) a loan for your home then you need an owner-occupier home loan.

4. Loan features

Variable rate loans come with the most features. You can make extra repayments to pay the loan off faster. And most variable rate loans have a redraw facility too.

Some variable rate loans have an offset account, which functions like a bank account. But instead of earning interest on the savings it reduces your loan's interest charges and gets you out of debt faster.

Our expert says

"If you have a variable loan, it's a great idea to also have an offset account. While that can mean extra costs, it allows you to offset your savings against your loan and can save a lot in a high-interest world."

Graham Cooke

Head of Consumer Research

Is now a good time to get a variable rate home loan?

• The lowest variable home loan rate right now on Finder is 5.59%.
• The average variable home loan rate on the market is 7.49%.

There's never really a "best" time to get a variable rate home loan. When rates are falling, variable rate loans can work out better.

Fixed rate loans are great when rates are rising fast. That was the case in 2022–23. But now rates have stayed where they are for a while, and it is unclear whether the next move will be a rise or a fall.

When deciding between fixed and variable it's more important to think about how comfortable you are with the current rate and whether you can afford more rate rises.

What's the difference between fixed rate and variable rate home loans?

Variable rate mortgages...

• Go up and down over time. Lenders can change your rate at any time (usually when the RBA changes the official cash rate). Lenders increased their variable rate loans 8 times in 2022 and another 5 times in 2023!
• Are flexible. You can repay a variable rate loan early or refinance and your lender won't charge any fees.
• Usually have lower rates. Fixed rates are typically higher than variable rates (that's the price of certainty). But this isn't always the case.

Fixed rate mortgages...

• Won't change (for the fixed period). You can fix your rate for 1 to 5 years. And your repayments won't change during this time.
• Turn into variable rates anyway. Once the fixed period ends you're back on a variable rate.
• Are harder to break. Refinancing or repaying a fixed rate loan early comes with a break fee. This can cost thousands of dollars.

Most borrowers go for a variable rate

A variable rate loan is really about flexibility: paying the loan off faster via an offset account or extra repayments.

And it's about being able to exit the loan or refinance without paying a break fee.

Most Australian borrowers choose a variable rate. According to the AFG Index, just 1.6% of borrowers chose a fixed rate in the last 3 months.

Still unsure? Consider the split rate option

Australian borrowers don't have to pick between variable and fixed. Many lenders allow you to split your loan into fixed and variable portions.

"I'm team variable interest rate all the way. I don't fix my rate and I don't bother with a split rate either. For me, the value of a variable rate loan's flexibility and getting the full benefit of an offset account is so important. I can refinance whenever I need without penalty and if I decide to sell or make a big change that requires a new loan, it's so much easier."

Richard Whitten

Money Editor

The lowest variable rate vs the lowest fixed rate loan over time

This graph shows how the lowest variable rate loan has compared to the lowest fixed rate loan over the last few years.

Fixed vs variable rates: What are the differences?

Finding the best variable rate home loan for you

Every month, our home loan experts analyse more than 50 home loan rates from our database to find our best home loan picks. We only select home loans that are suitable for a typical borrower, so we don't include loans that require enormous deposits or have extra eligibility requirements.

We then rank these loans, with a scoring system that awards a higher score for loans with the lowest rates and fewest fees.

All our picks are from lenders with whom Finder has a commercial partnership. The best home loan looks a little different for every borrower and our picks may not be the best option for your situation.

Why you can trust Finder's research

100+ rates compared

Analysis from the experts

Picks updated monthly

2025 Finder Awards winners

Here are the variable rate home loans that won recognition at the 2025 Finder Home Loan Awards.

To determine the winner of Finder's Home Loan Lender of the Year - Big Bank award, we examine the home loans offered by the top 10 lenders with the largest loan book. We then look at the rates, fees and features of owner-occupier and investor loans to judge how competitive their loans are. This year, Bendigo Bank won. Collectively, its own loans and those of its subsidiaries offer the most competitive home loans.

Tiimely Home's Own 10% deposit Variable Rate - Principal & Interest with offset home loan won this year's Best Owner Occupier Variable Home Loan Finder Award with its consistently low interest rate, almost zero fees and an offset account.

Tiimely Home's Own 10% deposit Variable Rate - Principal & Interest with offset wins the Best First Home Buyer Home Loan award for 2025. This loan combines one of the market's consistently lowest interest rates with very low fees and an optional 100% offset account. It's especially attractive for first home buyers because it's available with a 10% deposit.

Tiimely Home's Own 10% deposit Variable Rate - Principal & Interest with offset has taken out this award for another year. It's a loan that's just as good for new borrowers as it is for refinancers, with a low variable rate, low fees and the option of a 100% offset account.

Bendigo Bank comes out on top for the best variable rate for refinancers for the top 10 largest banks in Australia. Its Express home loan does have a monthly fee of $10 and you do need to be buying within a capital city or major regional centre, but it also has a full offset account with a speedy application process.

Easy Street's Smart Variable Home Loan (Investor, P&I) is the winning product for investors who love zero ongoing fees, saving money with an offset account and competitive interest rates.

Queensland Country Bank's Ultimate home loan package with a special variable rate, is Finder's 2025 winner for the Best Investor IO Variable Home Loan category. On top of the zero fees, solid interest rate and 100% offset account which won it the top spot, the Queensland Country Bank Ultimate home loan comes with some extra perks like $0 fee on the package credit card and 10% discount on home and contents insurance.

Some borrowers just want a no frills home loan with two things: low fees, and the lowest rate you can get. In the value home loan category, Unloan came out on top with no application, ongoing or exit fees and one of the lowest variable rates on the market.

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Frequently asked questions about variable rate home loans

• What is the best variable home loan rate in Australia?

  Interest rates have changed a lot over the last couple of years and they could change over the next few months as well. While good interest rates are important, remember to look at what other features and fees come with the loan.

• Is a variable rate home loan better than a fixed rate home loan?

  Whether you choose a variable rate home loan or a fixed rate home loan is really dependent on your circumstances. Most borrowers prefer the flexibility of a variable rate loan.

  If you'd rather know exactly what you're paying each month so you can forget about rate changes, consider a fixed rate.

  Use our repayment calculator and speak to a mortgage broker if you want more information on what the right rate is for you.

• How do I know if variable rates are going to rise or fall?

  Lenders are free to move your variable interest rate up or down whenever they want. In practice, lenders move rates in response to wider market and economic conditions.

  While you can't really predict rate changes perfectly, it is possible to get a good sense of which direction rates are moving in.

  The Reserve Bank of Australia (RBA) sets the official cash rate each month. This is a benchmark for lenders to set interest rates on variable rate home loans.

  The RBA lowers interest rates to stimulate economic growth and encourage spending. When inflation is high, the RBA raises rates to cool spending and drive prices down.

• Which bank has the best variable rate?

  Credit unions and online lenders have the lowest variable rate home loans. And for most borrowers, lowest rate = best.

  But the big banks have really good apps and in-branch service. That can be a very big benefit.

• What types of variable rate home loans do lenders offer?

  Most lenders offer multiple variable rate home loans.

  • Basic variable home loans. A basic variable loan has a lower rate than a lender's other products (usually) and doesn't come with an offset account. These loans are all about the low rate.
  • Introductory discount home loans. These loans (sometimes called honeymoon home loans) are often the lowest variable rate loans a lender offers. But after the initial discounted period, the rate will revert to a higher rate. That's usually a good time to switch to a better loan.
  • Package home loans. These loans let you combine your mortgage with an offset account plus a credit card or other financial products. In exchange, you get discounted fees on the products and the convenience of having all your banking in one place. The downside? You pay an annual package fee of several hundred dollars.
  • Standard variable home loans. Standard variable rates are a bit of a throwback. These are the benchmark variable rates used for home loans with the Big Four banks and some other lenders. Most lenders discount the actual rate you get or will recommend a similar loan with a lower rate.

• When will mortgage rates go down in Australia?

  Interest rates rose rapidly in 2022 and into 2023, but now the RBA has started to cut rates. The first interest rate cut came on 18th February 2025. Economists are predicting there will be more cuts throughout the year.

• What is a good interest rate on a variable rate home loan?

  A "good" interest rate will really depend on the loan you need for your circumstances. Right now, a low 6% rate is competitive. The lowest rates are just below that. For example, the lowest variable interest rate on the Finder website at the moment is 5.59%.

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

Money Editor

Richard Whitten is Finder’s Money Editor, with over seven years of experience in home loans, property and personal finance. His insights appear in top media outlets like Yahoo Finance, Money Magazine, and the Herald Sun, and he frequently offers expert commentary on television and radio, helping Australians navigate mortgages and property ownership. Richard holds multiple industry certifications, including a Certificate IV in Mortgage Broking (RG 206) and Tier 1 and Tier 2 certifications (RG 146), as well as a Graduate Certificate in Communications from Deakin University. See full bio

Richard's expertise

Richard has written 609 Finder guides across topics including:

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