Split Loan Comparison
If you have been agonising over the decision between a fixed rate home loan and a variable rate home loan, your choice can be decided by choosing a split loan. A split loan allows you to allocate a portion of your loan amount to attract a variable interest rate, and another portion to attract a fixed rate so you are able to take advantage of the security of a fixed rate but the flexibility of a variable rate, as well as reduce the impact on your loan repayments if interest rates rise.
Featured Split Home Loan Offer
Apply for Loans.com.au – Dream Catcher home loan and get a low variable rate, plus no application fee, no valuation and lender's legal fee.
- Interest Rate of 6.13%
- Comparison Rate of 6.47%
- Application Fee of $0
- Maximum LVR With LMI: 80%
- Minimum Borrowing: $50,000
- Maximum Borrowing: $750,000
Best Variable and Fixed Rate Home Loans to Combine to make a Split Rate Loan
| Home Loan | Details | Interest Rate (p.a.) | Comp Rate^ (p.a.) | App Fee / Ongoing Fee | Max LVR | Min & Max Borrowing | |
|---|---|---|---|---|---|---|---|
 Loans.com.au – Dream Catcher |
A home loan with a no application fee, no legal fee and a low interest rate. | 6.13% | 6.47% | $0 / $375 | 80% | $50,000 / $750,000 |
 
|
 UBank UHomeLoan (Variable Rate) |
The UBank Home Loan offers you a low interest rate and no ongoing and no application fees. | 6.14% | 6.14% | $0 / $0 | 80% | $100,000 / $1,000,000 |
|
UBank UHomeLoan – 3 Year Fixed Rate |
A fixed rate loan protected against interest rate hikes. | 6.34% | 6.46% | $0 / $0 | 80% | $100,000 / $1,000,000 |
|
 Resi Home Loans – Flexi Fix |
Fix up to 50% of your home loan at a low fixed rate and the other 50% at a low variable rate. | 5.75% | 6.69% | $0 / $0 | 95% | $50,000 / $2,000,000 |
|
 State Custodians Mortgage Company Breathe Easy Offset Loan |
Variable Rate Component A competitive loan from a leading non bank lender |
6.47% | 6.36% | $0 / $0 | 95% | $150,000 / $1,000,000 |
|
State Custodians Mortgage Company Standard Fixed Home Loan – 1 Year Fixed Rate |
Fixed Rate Component Enjoy certainty in your repayments with this great fixed rate loan. |
5.97% | 6.75% | $0 / $0 | 95% | $150,000 / $1,000,000 |
|
 Illawarra Home Loans Bank Beater Home Loan |
A low variable rate plus a further rate cut of 0.05% p.a. after 5 years. | 6.18% | 6.46% | $0 / $345 | 90% | $250,000 / $1,000,000 |
|
 HomeStar Gold Loyalty Home Loan |
Variable Rate Component One of the most competitive loans on the current market featuring a rate drop of 0.15% after 5 years. |
6.48% | 6.40% | $0 / $0 | 95% | $750,000 / $2,000,000 |
|
 NAB Introductory Rate Home Loan – 1 Year Fixed Rate |
Fixed Rate Component Introductory Rate (12 Months Fixed) |
6.19% | $600 / $8 | 95% | $20,000 / $10,000,000 |
|
Note: These are just a selection of 1 year fixed rate and the providers standard variable rate loans. You might want to combine different fixed rate loans with your chosen loan. Its best to speak with the provider about your preferred combination.
How To Use A Split Loan
You don’t always have to decide if you want a split loan when you apply, because you can set up your home loan and consider your budget in the context of where you think official interest rates will be going. A split loan works by:
- It is not a separate type of loan. A split loan is not a set type of loan in the way that you can choose a low doc loan or an investment loan. Instead a split is a feature which is included in a loan package which you may choose to add to your home loan when you apply.
- You choose the split. You can usually choose to allocate any amount of your loan to both a variable and fixed interest rate. Popular splits are 60% variable and 40% fixed, or a split down the middle or 50-50 to distribute interest-rate movements and risks.
- You don’t have to know what rates are doing or what you’re doing. When you choose a home loan it is best to think about where you will be in 5 to 10 years so you can choose a loan with the features an interest rates which will suit your needs now and then. It is also important to consider where interest rates are on their cycle before you choose a fixed or variable interest rate loan. However if you’re not sure what rates are doing and you’re not sure where you will be in the future, a split loan gives you the best of both worlds and the effects are effectively halved for each split. While official interest rates may rise only a portion of your split loan will be affected and the effects are lessened.
How To Find The Best Split Loan
Since the split loan is simply a feature which you can add to many existing home loan offers, you need to know what you are looking for in a split loan package deal and what makes for a good deal and whether you need to split. When comparing split loan offers:
- Decide whether the other features of the package will benefit you. As a split loan is usually part of a professional package offer on top of a standard home loan, consider whether the other benefits and features included in the package are worth the additional costs to add this package to your loan.
- Look for a low or no setup fees. Some lenders will charge you each time you speak your loan between fixed and variable rate, however it is possible to find a split loan with affordable fees, or a fee free split option.
- Make sure there are no penalties for additional repayments. Although you have a portion of your home loan as variable, some of it still behaves independently as a fixed portion and as such you may be charged when you make additional repayments towards your loan. Therefore find out whether you are able to make repayments to just the variable portion of your loan or whether you can avoid additional repayment fees altogether.
- You can choose the length of the split term. As with other fixed interest rate terms on home loans you can choose the length of time your loan is split into a fixed and variable rate to split term is available to you will depend on your lender and on package you have added to your loan.
If you’re a somewhat fickle especially when it comes to your finances you could benefit from having your finger on the pulse of both a variable-rate loan and a fixed-rate loan all in one.
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