Fixed rate home loans that allow additional repayments

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Since the RBA confirmed that the spot rate could rise earlier than expected at its November meeting, many borrowers have turned to fixed rates to protect their finances against rising rates.

Although the increase in financing costs has already led to a rise in long-term fixed rates, the average 4-year rate among the lenders we track is still much lower than the average variable rate – 2.75% per annum compared to 3 , 11% per year at time of writing.

But unlike variable rate loans, fixed options are often limited in the functionality they offer. So if you are looking for a fixed rate loan that allows you to make additional free and unlimited repayments, you might have your work cut out for you.

Fortunately, there are fixed options that are not too strict with their limits. We’ve compiled a few below to help those who want to advance their mortgage loan while still enjoying the certainty of a fixed rate.

Newcastle special fixed rate permanent mortgage
  • Free additional refunds up to $ 25,000 per year
  • 2.59% pa (comparison rate of 3.65% pa *) on 4-year terms
  • Qualifying refinancers may receive $ 2,000 cash back (conditions apply)

The Newcastle Permanent Special Fixed Rate Home Loan allows you to make additional repayments of up to $ 25,000 per year, so it will certainly be appreciated by those looking to pay off their loan sooner than expected. A compensation account is also available, so if you have more cash on hand but don’t want to spend it on your mortgage, you can still use it to save on interest.

In addition, you can also receive $ 2,000 cash back when refinancing a loan of at least $ 250,000 (home loan comes with a set-up fee of $ 595, and breakage fees may apply if you exceed the amount of additional repayments allocated.

Well-balanced home loans Fixed
  • Free additional refunds up to $ 20,000 per year
  • 2.79% pa (comparison rate of 2.28% pa *) on 4-year terms
  • Clearing account available for $ 10 per month

The Qudos Bank Fixed Rate Home Loan allows for up to $ 10,000 in additional repayments per year, as well as a withdrawal facility in case you feel that some of those additional repayments are better served out of your pocket. And for an additional $ 10 per month, you can use a clearing account to save on interest.

The interest rates available are also very attractive, with 4-year rates standing at 2.79% per annum (comparison rate of 2.28% per annum *). However, you will need to plan for a few fees, such as an application fee of $ 250, legal fees of $ 385, settlement fee of $ 150, and discharge fee of $ 300. Penalties will also apply if you make more additional refunds than allowed.

Tic: Toc Fixed mortgage
  • Free additional refunds up to $ 20,000 per year
  • 2.59% pa (comparison rate of 2.12% pa *) on 4-year terms
  • Clearing account available for $ 10 per month

Backed by Bendigo Bank and Adelaide Bank, Tic: Toc is an online lender launched in 2017. On this loan, borrowers will be able to make up to $ 20,000 in additional repayments each year, and the free withdrawal facility means you can access these funds. if you need it later. A clearing account is also available, but it will cost an additional $ 10 per month. While this loan is fairly light on fees, there is a discharge fee of $ 325 and a service charge of around $ 60 for online settlement (or $ 80-200 for paper settlement).

HSBC Fixed Rate Home Loan (Package)
  • Free additional refunds up to $ 10,000 per year
  • 2.60% pa (comparison rate of 2.84% pa *) at 5 years
  • Qualifying refinancers may receive cash back of $ 3,288 (conditions apply)

With the HSBC Fixed Rate Home Loan, additional repayments are allowed up to $ 10,000 per year, giving more diligent borrowers a chance to meet their mortgage goals faster. Refinancers may also be eligible for cash back of $ 3,288 when refinancing a home loan of at least $ 250,000, although they will need to apply by December 31, 2021 and pay by February 28. 2022 (general conditions apply).

There are a few fees you’ll need to watch out for with this one, including the annual service charge of $ 390 and the discharge fee of $ 300. Break fees will also apply if your additional reimbursements exceed $ 10,000 per year.

Qudos Bank Fixed rate mortgage
  • Free additional refunds up to $ 10,000 per year
  • 2.59% pa (comparison rate of 2.73% pa ​​*) on 4-year terms
  • No upfront or ongoing costs

Those who hope to pay off their mortgage faster while taking advantage of competitive rates might appreciate this offer from Qudos Bank. The rates are 2.59% per annum (compare rate of 2.73% per annum *) on 4-year terms and you will be able to pay up to $ 10,000 more each year (paying more will result in penalty). Unfortunately, you will not have access to a reprint feature, which means these additional refunds cannot be recovered if you need them in the future. Fortunately, you won’t have to worry about many charges beyond the $ 275 landfill fee.

For an overview of other options currently available, browse our Fixed Rate Home Loan Comparison page.

* CAUTION: This comparison rate only applies to the example (s) given. Different amounts and terms will result in different compare rates. Costs such as redemption or prepayment charges, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is that of a guaranteed loan with monthly repayment of principal and interest of $ 150,000 over 25 years.

** The initial monthly repayment figures are only estimates, based on the advertised rate, loan amount and term entered. The rates, fees and charges and therefore the total cost of the loan can vary depending on the amount of your loan, the length of your loan and your credit history. Actual repayments will depend on your personal circumstances and changes in interest rates.

^ See information on the Mozo Experts Choice Home Loan Awards

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