If you don't fix your loan, your interest rate will move with changes to market interest rates. This means the interest rate can rise or fall over the term of your loan. As a result, your repayments will 'vary' as the rate changes.

Here are some advantages of a variable rate home loan:

  • You can make extra repayments -
  • Extra repayments are usually allowed at no extra cost, which can save you interest and help you pay off your loan sooner.

  • More features -
  • Variable loans often have attractive features such as unlimited redraws on any additional repayments or the ability to save on interest by setting up an offset account.

  • Easier to switch loans -
  • It is usually easier and cheaper to switch loans if you find a better deal elsewhere if you have a variable rate home loan.