Loan features

Comparison rates explained

Understand why comparison rates can help, what they include, and why they still do not show every borrower outcome.

Updated: 15 June 2026
Read time: 7 min read
Reviewed by: emoney broker team

Reviewed for general guidance. Reviewed by emoney broker team. Last updated 15 June 2026. Sources are listed below so borrowers can check the public references behind this general information before speaking with a broker.

Key checks before you decide

Check the advertised interest rate.
Check the comparison rate.
Check application and ongoing fees.
Check the assumptions behind the comparison.
Comparison rates may not reflect how you use offset.
They do not show lender policy fit.

Full guide

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Guide

Comparison rates help reveal some costs

A comparison rate can help because it puts the advertised interest rate and certain fees into one figure. That can make a loan with a low headline rate and higher included fees easier to compare against another option.

It is a useful starting point, especially when a borrower is scanning several loan options. It can reduce the risk of looking only at the advertised rate while missing establishment or ongoing costs that form part of the loan comparison.

It is still only one input. A loan with a lower comparison rate may not fit the borrower's feature needs, income type, property, timing, or lender policy.

Check the advertised interest rate.
Check the comparison rate.
Check application and ongoing fees.
Check the assumptions behind the comparison.

Watch out

They do not capture every feature

Comparison rates do not show the whole borrower outcome. Offset use, redraw access, cashback offers, package value, repayment behaviour, loan size, and loan term can all change the practical result.

A feature-rich loan can carry extra cost that is worth discussing if the borrower will actually use the features. A simpler loan can look cheaper but may not have the flexibility needed for extra repayments, offset, or future review.

This is why a comparison rate should be read beside the loan feature list, repayment type, rate type, fees, and lender policy. The number is helpful, but it is not the full decision.

Comparison rates may not reflect how you use offset.
They do not show lender policy fit.
They do not decide whether cashback changes the net outcome.
They do not replace a document and serviceability review.

Checklist

Use them as one input

A good comparison puts the comparison rate beside repayment estimates, fees, features, and the reason for the loan. The goal is to understand the overall position, not just find the smallest number.

For a purchase, the comparison may need to consider deposit, LVR, settlement timing, pre-approval, and documents. For a refinance, it may need to consider discharge fees, break costs, package fees, valuation, cashback timing, and how long the borrower expects to keep the loan.

The comparison rate can help narrow the conversation, but a broker still needs to check whether the product can actually work for the borrower.

Compare the repayment estimate.
Add known upfront and ongoing fees.
Check feature value against real use.
Ask whether lender policy fits the borrower.

Broker note

Be careful with rate-only decisions

A rate-only decision can miss costs or restrictions that affect the borrower later. It can also miss situations where the cheaper-looking option is slower, less flexible, or not available for the borrower profile.

This matters for borrowers with variable income, self-employed income, tight settlement dates, low deposits, unusual properties, fixed-rate break costs, or plans to use equity later.

If the loan is for an existing borrower, the current loan should be reviewed first. Staying, repricing, refixing, restructuring, or refinancing can each have different costs and timing.

Do not compare rate without loan purpose.
Check what fees are included and excluded.
Ask if the lender policy fits the borrower type.
Check timing before assuming a switch is practical.

Next step

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Answer a few questions so emoney can route your enquiry to the right broker conversation.Compare loan options

Example

Run the numbers with a calculator

A repayment calculator can help show how the interest rate, loan amount, and loan term change repayments and total interest. It gives the comparison rate conversation more context.

For refinance, a switching calculator or refinance savings estimate can help test the payback period after switching costs. For buying, the repayment estimate should sit beside deposit, duty, upfront costs, and cash buffer.

The calculator result is still an estimate. It does not decide lender approval, product availability, or whether a loan is suitable.

Compare repayment amount at the same loan term.
Test total interest, not only monthly repayment.
Include switching or upfront costs where relevant.
Ask what changes if the rate moves.

Broker note

Ask a broker to compare the real shortlist

Once the comparison is clear, the next step is to check the real shortlist against lender policy, documents, serviceability, features, fees, and timing.

A broker can explain the trade-offs across lenders on their panel. That still requires your actual circumstances, documents, goals, and property context. The comparison rate helps frame the question, but it should not carry the whole decision.

If you already have a loan, bring the current rate, comparison rate if available, fees, loan balance, repayment amount, remaining term, and any offset or redraw details.

Which costs are included in the comparison rate?
Which costs or benefits are not included?
Does the product fit my loan purpose and documents?
What would make a different option more practical?

Calculator next step

Home loan repayment calculator

Test whether a loan amount, rate, term, and repayment type feel workable before taking the numbers further.

Best for: Checking repayment comfort across purchase, refinance, or rate-change scenarios.
What it calculates: Weekly, fortnightly, or monthly repayments from loan amount, rate, term, frequency, and repayment type.

A broker still needs to check fees, comparison rates, offset or redraw settings, loan structure, and policy fit.

Open Repayments

Sources used

officialASIC MoneySmart choosing a home loan officialASIC MoneySmart mortgage calculator officialASIC MoneySmart using a mortgage broker officialASIC responsible lending obligations

General information only

This guide is general information and does not take into account your objectives, financial situation, or needs. A broker can review your circumstances before any recommendation.