Comparison rate

The comparison rate is a legally mandated rate quote (under the National Credit Code) that combines the advertised interest rate with most of the standard fees and charges, expressed as a single annual percentage. It's designed to stop lenders winning on headline rate while hiding the real cost in fees. The standard comparison is based on a $150,000 loan over 25 years, which often doesn't match what you're actually borrowing. The comparison rate still misses some real-world costs (early repayment penalties, redraw fees, ongoing offset fees beyond a flat annual), so it's a useful starting point but not the final word. Always model both the headline and comparison rate against your actual loan size.