Comparison Rate Calculator
Understand the true cost of your home loan with our comparison rate calculator.
Calculate Comparison Rate
What is a Comparison Rate?
A comparison rate is a tool designed to help consumers understand the true cost of a loan. It includes the interest rate and most fees and charges associated with the loan, expressed as a single percentage.
This calculator helps you see how different fees and charges can impact the overall cost of your loan, allowing for a more accurate comparison between different loan products.
Always look at the comparison rate, not just the advertised interest rate, when choosing a home loan.
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Frequently Asked Questions
What is a comparison rate?
A comparison rate is a single percentage figure that includes the interest rate and most fees and charges relating to a loan. It's designed to give you a more accurate picture of the total cost of a loan.
Why is the comparison rate important?
The comparison rate helps you compare different loan products on a like-for-like basis. Without it, you might only look at the advertised interest rate and overlook significant fees that add to the overall cost of the loan.
What fees are included in the comparison rate?
Typically, the comparison rate includes ongoing fees (like monthly or annual fees), establishment fees, and other charges that are known at the time the loan is offered. It generally does not include government charges like stamp duty or fees for late payments.
Does the comparison rate guarantee the total cost?
No, the comparison rate is an indicative rate based on a standard loan amount and term. Your actual costs may vary depending on your specific loan amount, term, and any additional fees or charges that are not included in the comparison rate calculation.