Variable Rate Home Loan
Over 50% of all mortgages in Australia are variable rate home loans, making them by far the most popular type of home loan. This popularity is driven by the fact that they offer a range of very useful features and enable borrowers some flexibility with how they repay the home loan.
The Interest Rates on Variable home loans increase and decrease in accordance with fluctuations in the rates set by the Reserve Bank of Australia (RBA). If interest rates rise, your mortgage repayments increase; if they fall, your payments are reduced. While RBA rates are a key influencer on the interest rate changes, Home Loan lenders are ultimately responsible for what interest rates are applied to their variable home loans.