Variable rate
A variable rate can move at the lender's discretion, usually following the cash rate but not bound to it, and the repayment moves with it.
Variable rate, explained.
Variable loans carry the features fixed loans restrict: unlimited extra repayments, offset accounts and redraw. They also carry the risk of a higher repayment if rates rise.
Lenders commonly offer new customers a larger discount off the standard variable rate than they give existing customers, which is why a variable loan left alone for years drifts above the market. A repricing request, supported by a written competing offer, is the least expensive remedy and the first step in any review.
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The Learn section is general information about lending in Australia. It does not take account of your objectives, financial situation or needs, is not credit assistance, and is not tax, legal or financial advice. Lender policies, government schedules and regulations change; check the current position with the relevant body or with us before relying on it.
