Some of the top-rated home loans for investors and refinancers in July 2023

While a new governor and revised meeting schedule could change the future of the Reserve Bank of Australia (RBA), many everyday homeowners and investors are still dealing with the past 12 rate hikes. As more borrowers come face to face with the fixed rate cliff, it becomes more important than ever to work out the overall value offered by different mortgage offers before you consider switching.

To help borrowers quickly work out which home loans may offer them the most value, RateCity developed its Real Time Ratings™ system, which expresses the cost and flexibility of a home loan as a simple star rating. The top-rated home loans in different categories can be compared on the RateCity Home Loan Leaderboards, and the top-rated loans may also become eligible for the RateCity Gold Awards.

(Rankings are correct at the time of publishing. Please note lenders may trade places on the list as interest rates and fees change and RateCity’s tracker reflects these movements.)

Recent figures from the Australian Bureau of Statistics (ABS) revealed that the value of external refinancing (in seasonally adjusted terms) for total housing rose 8.1% month-on-month to $21.0 billion, and was up 22.4% year-on-year. Much of this refinancing activity may be being driven by the approaching fixed rate cliff, with borrowers hoping to limit the impact of their low fixed loan reverting to a variable rate.

While some of the big banks have ended the cashback offers that can help to manage the cost of refinancing, several have also chosen to slash their serviceability stress tests for refinancers, which may offer some borrowers an escape route from mortgage prison. Before you refinance, it’s essential to compare home loan interest rates, fees, features and benefits so you can be confident you’ll be getting a better deal from your new lender.

The increased competition for refinancers among mortgage lenders has led some big banks to withdraw some of their mortgage offers, with rates rising and cashbacks disappearing.

If the well-established banks aren’t offering the refinance deals you want, it may be worth comparing what some of the newer mortgage lenders on the block have to offer. Depending on your financial situation, you may be eligible for switching incentives such as bonus reward points or interest rate discounts.

It’s not easy to predict Australia’s financial future. Even economists from the leading banks have had to regularly revise their predictions with each RBA meeting. Depending on how inflation responds to rate rises and other factors, there’s also the chance that Australia could experience a recession in the future, which could have a long-lasting effect on the economy.

If you’re not a fan of volatility, you may be interested in locking in your home loan interest rate for a few years. This can keep your mortgage repayments consistent, for simpler budgeting, though there is the risk that you could potentially miss out on some savings if variable rates were to fall during the fixed rate term.