Last Updated: 20th May, 2024

A Quick Overview

Details Description
Customer Goal  To get a lower interest rate than the current revert rate of 5.89%, with a 100% offset account.
Problem  The client was worried about reverting to a high interest rate. She wanted to refix but also wanted an offset account.
Loan Amount  $540,000
LVR and Term 67.08%, 30 years
Income  $90,600
Solution  Refinanced to a split loan by choosing the lender that had the lowest rates – 5.39% (fixed) and 4.54% (variable) – and a $3,000 refinance cashback offer.

The Dread Of Coming Off A Low Fixed Rate

Mary was ecstatic when she bought her first house in 2020 – and at a low interest rate of 1.97% fixed until 2023, too.

But her happiness was short-lived.

Last year, as Australia started recovering from COVID-19 lockdowns, the inflation rate started climbing, too. To combat this, the Reserve Bank Of Australia (RBA) resorted to increasing the cash rate, causing Mary’s variable rate to go up as well.

As each month passed, the cash rate increased, and there were no signs of it falling. By December 2022, it was 300 basis points higher than when it began rising in May of that year. Mary felt restless, as she would come off her fixed rate soon, and was worried about being reverted to a high variable rate.

Fearing A High Revert Rate

Mary reached out to us to get a better understanding of how high her revert rate would be.

She wanted to fix her home loan again. She also wanted an offset account but that was impossible with a fixed loan. So, she decided to go for a split loan.

Splitting The Loan 50-50

Home Loan Experts mortgage broker Rojina Shivabhaki took up the challenge of finding the best rate out there for Mary.

First, she needed to know what Mary expected to get from refinancing. She wanted to ensure that everything was communicated well with Mary to put her mind at ease.

Mary wanted the following:

  • To refinance to a more competitive rate
  • To find a lender providing refinance rebates
  • To find a lender who accepts overtime and penalty incomes favourably.

Based on that, Rojina established the following as product requirements:


Mary’s fixed-rate options with her current bank were as follows: 

  • 1-year fixed rate: 5.59%
  • 2-year fixed rate: 5.89%
  • 3-year fixed rate: 5.99%

Wanting both the security of a fixed rate and the flexibility of an offset account, Mary decided to split her loan in half. This meant that $270,000 would be on a fixed rate, and $270,000 would be on a variable rate.

Since Mary is a nurse, Rojina knew it was also important to find lenders that accepted overtime income with little shading. Rojina knew just which lenders to look at and found two that best met Mary’s requirements.

Mary chose the lender that gave her the more competitive interest rate and got conditional approval within two weeks.

Refinanced For A Happier Future

Mary got exactly what she asked for – a 100% offset account with redraw facilities and a split loan with competitive rates and a cashback of $3000. This is what her loan structure looked like:

Loan 1: $270,000 – 2-year fixed rate, 5.39%

Loan 2: $270,000 – variable rate, 4.54%, 30 years

Before refinancing, her monthly interest repayment was approximately $3,059 and after refinancing, her monthly repayment is $2,888. She was able to save about $171 a month on her repayments. She was also able to enjoy the additional facilities that would not have been available to her had she re-fixed with her old lender. She was glad that Rojina and her team were there to explain and guide her through the process and reassure her.

If you are interested in exploring the benefits of a split loan or want to look into other options to maximise your savings and flexibility, Call us today on 1300 889 743 or complete our free assessment form.

We will guide you through the process of finding the right loan structure and features to meet your unique financial goals and needs. Whether you’re interested in a split loan, fixed loan, variable loan or any other loan, we have the knowledge and experience to find the best solution for you. Don’t wait to take control of your financial future – let us help you today!