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Split Loans

Can’t decide on a fixed or variable rate loan? Get the best of both worlds.

A split rate home loan allows you to divide your home loan into several accounts that can be used for different purposes. These can also be different loan products.

A common example is to split your home loan to obtain a variable interest rate on one portion of the loan and a fixed rate on the other.

For example: If you require a loan amount of $350,000, you can split your loan with $250,000 at a fixed rate and the remaining $100,000 at a variable rate. This gives you the flexibility a variable rate loan offers, while having certainty of a fixed rate on a portion of the loan.


  • Split loans are a great compromise, allowing you to reap the benefits of both fixed and variable rate loans at the same time.
  • The fixed rate portion offers you certainty and protects against sudden interest rate rises.
  • The variable rate portion gives you flexibility and allows you to make the most of interest rates reductions.
  • You can pay off your loan sooner by making extra repayments on its variable rate portion.
  • If you select a variable and fixed portion split, the variable portion may offer extra benefits, including a redraw facility or an offset account.
  • There are no restrictions on how to split your home loan. Whether you split it right down the middle or 80%/20%, it’s up to you.

Sounds like you can have your cake and eat it, too. However, there are some considerations to take into account before opting for a split loan:

  • You may miss out on potential savings on the fixed portion of your loan if interest rates should fall.
  • If interest rates rise, you will end up paying more on the variable portion of your loan.
  • There may be additional costs associated with this type of loan.
  • If you need to payout the loan early within the fixed rate period, early payout costs may be substantial.
  • Consider where you want to be in the next five years. This will help you choose a loan with features suitable to your goals and objectives.

If you feel that a split loan fits your financial circumstances, or still have questions, get in touch with our credit and mortgage advisors. We can discuss your lending options to ensure you secure the most suitable home loan structure for your own personal needs.