Cashback home loan deals in August 2024

A home loan with a cashback deal can put some money back into your pocket. However, cashback deals are becoming rarer. With only a few providers offering these deals, it’s more important than ever to compare your options before making a decision. 

Even though such deals are getting less common, they can provide significant benefits under the right circumstances. Such deals can help offset some of your refinancing expenses, finance minor home improvements, or provide an early boost to your mortgage repayments. However, the potential cashback shouldn’t be the sole factor in choosing a home loan. 

It’s crucial to assess whether a cashback deal is truly beneficial in the long run. While the extra cash upfront is appealing, potentially higher interest rates and fees could sometimes result in greater overall costs compared to a basic home loan. Be sure to crunch the numbers before committing. 

As of August 2024, only 7 lenders are offering cashback deals, a significant drop from the peak of 35 in March 2023. Current offers on RateCity’s database indicate that you may be able to receive cashback ranging from $2,000 to $4,000. Keep in mind that the amount of cashback you qualify for will depend on factors like your eligibility, the total loan amount, and your loan-to-value ratio (LVR). 

*For New Loans- FHB only

^expires on 15 Aug 2024

Source: RateCity.com.au. Data accurate as of 07/08/2024. Value of cashback you may be offered will vary depending on the lender's eligibility criteria. 

Most cashback offers are just for refinancers, but an alternative option sometimes offered to first home buyers is reduced or waived Lenders Mortgage Insurance (LMI). 

If your home deposit is less than 20%, LMI can be one of the biggest costs associated with a mortgage, alongside a deposit and stamp duty. Saving a 20% deposit can be extremely difficult, especially if you’re buying in Australia’s capital cities. 

While not available from all lenders, a select few may offer to waive or discount the LMI you’re charged. You may still need to pay a minimum deposit (e.g.15%) to benefit from an offer like this. LMI waivers are more likely to be offered to borrowers working in specialist professional fields, such as medicine, law, accounting or engineering. 

If no banks are offering waived or discounted LMI, some alternative options to consider include looking into government support from the First Home Owners Grant and/or First Home Guarantee, or looking into getting help from a Guarantor.