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Home Loans FAQ's

Q. How do I apply for a Commonwealth Bank Home Loan?

A. Complete a 5 minute online application and one of our Home Loan Specialists will call at a time that suits you to assist with the rest of the process. The information required to complete the online application is “front of mind” meaning you won't need to trawl through your records to provide answers.

You can also apply by requesting an appointment with a mobile lender, by calling us on 13 2224 between 8am and 8pm, 365 days a year, or by visiting any Commonwealth Bank Branch.


Q. What is the difference between a fixed rate loan and a variable rate loan?

A. Fixed Rate Home Loans have interest rates and loan repayments that remain the same for an agreed period of time, and then at the end of the term, reverts to a variable rate. 

A Variable Rate Home Loan has an interest rate that can move up and down according to fluctuations in the housing market. You should consider a fixed rate if you want the certainty of knowing what your repayments will be and therefore help you budget, not to try and “beat the market” as breaking out of a fixed rate (fixed term) loan contract could cost you thousands of dollars.


Q. Can I switch between a fixed rate and a variable rate?

A. Yes. You can change from a fixed rate to a variable rate, or vice versa, at any time. If you switch from a fixed rate loan, you may need to pay an Administration Fee and an Early Repayment Adjustment.

At the end of a fixed rate period your loan will automatically move to the variable rate (at no cost), or you can switch to another set period.

View our Switching Terms and Conditions.


Q. What is a Comparison Rate?

A.  A Comparison Rate reflects some of the costs of a loan into a single interest rate. The aim of the Comparison Rate is to help you make a more informed decision on the costs associated with a loan, and help you to compare various loans and services offered by financial institutions and mortgage providers. The formula for calculating a comparison rate is regulated by the Consumer Credit Code, and all Australian financial institutions and mortgage providers use this same formula.


Q. What is Lenders Mortgage insurance (LMI)?

Find out more about Lenders Mortgage Insurance


Q. What is the difference between a ‘Principal and Interest’ Home Loan and an Interest-only Home Loan?

A. A Principal and Interest Home Loan is where the principal repayment and the interest are repaid together throughout a loan’s term. Whereas an ‘interest only’ loan allows you to pay only the interest on the loan for a certain period of time.  If you live in your home, you can have an interest only period of up to 5 years, however if you have an Investment Home Loan, you have up to 10 years to pay interest only, after which you need to pay Principal and Interest for the remainder of the loan.


Q. What is Loan to Valuation Ratio (LVR)?

Find out more about LVR


Q. How can I take a break from making loan repayments?

A. Repayment Holidays are available for variable rate Home Loan customers who have made additional repayments on their mortgage. Loan suspension periods usually range from 3 months to 12 months. Talk to one of our Home Loan experts about your entitlements.


Q. What is Interest in Advance and how does it work?

A. We offer an Interest in Advance option on interest only Fixed Rate Investment Home Loans, which you pre-pay next year’s interest now and claim it back as a deduction this year. If you are eligible for this option you will get part of the interest back in the form of a tax deduction.