- 10 lenders offer cashbacks per InfoChoice research: ANZ, Reduce Home Loans, ME Bank, Credit Union SA, IMB, Newcastle Permanent, Greater Bank, BankVic, Regional Australia Bank, and Police Bank.
- Find out the requirements such as loan purpose, minimum loan size and loan-to-value ratio.
- Check if it's for new lending or refinances only.
- Find out how it's paid, and if it's straight cash or some other format.
- Prioritise the basics such as interest rates, fees, and features.
As the RBA cash rate came crashing down to 0.10% in November 2020, a number of lenders needed to do more than a cheap rate to stand out in a rapidly-growing mortgage and refinance market. Enter: cashback offers.
At one stage more than 30 banks and lenders offered some form of cashback. For example, Westpac, NAB, and CommBank withdrew theirs as the 2023 financial year drew to a close.
ANZ, however, is the only major bank still holding out at the time of writing, with no explicit sunset date on its $2,000 cashback for eligible refinances.
Though things are looking up! With an RBA rate cut in February 2025, some more lenders may come into the fray.
Below are some banks and lenders that offer cashback deals.
List of Lenders with Cashbacks
According to InfoChoice's database and research, 10 institutions currently have some form of cashback offer:
| Bank | Advertised Rate (Comparison Rate*)# | Cashback Offer (up to) |
|---|---|---|
| ANZ | 6.29% p.a. (6.29% p.a.) | $2,000 |
| ME Bank | 5.94% p.a. (6.33% p.a.) | $3,000 |
| Greater Bank | 5.84% p.a. (5.85% p.a.) | $2,500 |
| Newcastle Permanent | 5.84% p.a. (5.88% p.a.) | $3,000 |
| IMB | 5.89% p.a. (6.07% p.a.) | $4,000 |
| Credit Union SA | 5.84% p.a. (6.21% p.a.) | $2,000 |
| Reduce Home Loans | 6.39% p.a. (6.43% p.a.) | $10,000 |
| BankVic | 5.74% p.a. (5.74% p.a.) | $3,000 |
| Regional Australia Bank | 5.81% p.a. (5.82% p.a.) | $4,000 |
| Police Bank | 6.09% p.a. (6.06% p.a.) | $4,000 |
Rates current and checked weekly
#Rates displayed are for a representative variable-rate product for owner occupiers with 80% LVR
*Comparison rate based on $150k loan over 25 years. May not include all fees & charges
As cashback offers are popularly offered to refinancers, you will have to double check if the offer precludes refinances within the same banking group. For example, Newcastle Permanent and Greater Bank are part of the same group.
Crunch the numbers
While cashback can be an enticing offer, you still have to consider a mortgage’s ‘bread and butter’ such as interest rates, fees, and flexibility.
-
Interest rates: You’ll want to make sure you’re getting a competitive interest rate, as you will start to lose the benefit of the cashback in the first place if you are paying overs for an uncompetitive product.
-
Fees: Fees can be reflected in the comparison rate; a high comparison rate relative to the advertised rate usually means high fees. It’s no use getting a cashback only for it to be effectively gobbled up in fees when you start a new loan or refinance.
-
Flexibility: Cashback can go a long way in helping your budget and bottom line in the short term, however, you’ll want to make sure the home loan still retains flexible features such as extra repayments and free redraws. Further, some cashback offers may be attached to fixed-rate products, which are hard and costly to switch away from.
Do the Maths
Lender A offers a $2,000 cashback on a loan with a 6.24% p.a. interest rate. On a new $600,000 mortgage over 30 years, you'd pay $37,240 in interest in the first year due to the amortisation schedule. Take $2,000 away and that's $35,240.
Lender B offers no cashback but a 5.69% p.a. interest rate. In the same scenario, you'd pay $33,938 in interest in the first year. This scenario makes it more important to choose a competitive interest rate.
You also need to look at fees. If you're only going to stick around a year, take advantage of the cashback, then refinance, you might elect to cop monthly fees. However if you face hefty establishment or discharge fees, this might nullify the benefit of refinancing or claiming the cashback in the first place.
Play around with our mortgage calculator to find out how different scenarios compare.
Low-rate home loans without cashback
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.79% p.a. | 5.83% p.a. | $2,931 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
5.74% p.a. | 5.65% p.a. | $2,915 | Principal & Interest | Variable | $0 | $0 | 80% | 100% owned by Commbank |
| Promoted | Disclosure | |||||||||
5.84% p.a. | 5.86% p.a. | $2,947 | Principal & Interest | Variable | $0 | $250 | 60% | |||||||||||||
5.74% p.a. | 5.75% p.a. | $2,915 | Principal & Interest | Variable | $0 | $0 | 90% | |||||||||||||
5.89% p.a. | 5.91% p.a. | $2,962 | Principal & Interest | Variable | $0 | $350 | 60% |
Is it for new lending or refinances only?
If you’re applying for a totally new home loan, you’ll want to double check the offer you’re eyeing-off isn’t for refinances only. Restricting the cashback offer to refinances is a relatively low-risk ploy from a lender to take marketshare from a competitor and get a borrower on its books with a demonstrated history of repaying a home loan.
If you are refinancing a home loan for a cashback offer, keep in mind quite a few lenders preclude the offer if you’re refinancing from the same brand. This includes subsidiaries. For example, if Westpac had a cashback offer, it might exclude refinances from subsidiaries such as RAMS, St George, Bank of Melbourne, and BankSA.
If you’re refinancing, you’ll also want to take into account the typical costs of refinancing. This varies from lender to lender, but experts say the average is about $1,000, which includes valuation fees and various other admin costs. If you’re determined to make the most of your cashback, consider the costs first and look at a lender that minimises them.
Check the promotional periods and settlement dates
Lenders tend to change the nitty gritty on their cashback offers regularly. This might include short-lived promotional periods and settlement dates. Many lenders like you to apply by X date, and usually settle within 60-90 days of that date.
This means if the cashback is for NEW mortgages and you're buying a house, you will need to get your skates on if you want to take advantage of the cashback offer.
If you're refinancing, that makes it important to get your documentation right. This includes payslips, bank statements, current loan information and more.
Make sure you're eligible
Some lenders restrict cashback eligibility to those within a certain profession. For example, BankVic offers its most generous cashback to emergency service workers (police, firefighters, paramedics), and its lesser offer to healthcare workers. In this scenario, if you're a 6'5 guy in finance, blue eyes, you might be ineligible.
In addition, some lenders restrict where they lend. For example, much of Greater Bank's home loans are restricted to those in the ACT, New South Wales or Queensland.
Check the minimum loan size
Many lenders restrict eligibility to minimum loan sizes, ranging anywhere from $150,000 to more than $400,000. Generally speaking the biggest cashback offers go to bigger mortgages, sometimes requiring more than $1 million.
This might be to eliminate those heading towards the end of their mortgage from getting cashback, or those who are potentially in a position to pay it off in huge chunks.
How and when is the cashback paid?
Lenders might be reluctant to transfer you the cashback as cash into your bank account. They might offer to reduce the mortgage by that amount, offer it as gift cards, or some other form of renumeration.
Further, you might be waiting a while to see the cash. Some lenders make you wait 90 days after settlement until you actually see it, while others are a bit more quick on the draw. You will have to consult the terms and conditions or ask your lender directly as to how and when it’s paid.
Photo by Sandy Millar on Unsplash
