Buying your first home is a big step. Choosing the right mortgage can make or break the experience. With so many loan types available, it’s important to understand your options — and what suits your situation best.
In this guide, we’ll walk you through the most common home loan types in Australia, how they work, and what to consider before signing on the dotted line.
When choosing a mortgage, one of the first decisions is whether to go fixed or variable.
A fixed rate loan locks in your interest rate for a set period, usually 1 to 5 years.
Pros:
Cons:
With a variable loan, your interest rate can go up or down over time.
Pros:
Cons:
Coposit | Buy with $10K | Off the plan Sydney | First Time Home Buyers MortgageThe Newlands | Off the plan Sydney | Secure with $10k and $968 x 39 weeks
A split loan lets you divide your mortgage into fixed and variable portions. For example, you could fix 60% and leave 40% variable.
This gives you some stability while keeping flexibility. It’s a popular option for first home buyers who want balance.
Coposit | Buy with $10K | Off the plan Sydney | First Time Home Buyers MortgageCosmopolitan, Parramatta | Off the plan Sydney | Secure with $10k and $471 x 135 weeks
You repay both the loan amount (principal) and interest. This is the most common structure for owner-occupiers.
Why it’s good for first home buyers:
You only pay the interest for a set period (usually 1–5 years), then switch to P&I. These are more common for investors.
Why they’re risky for first home buyers:
Coposit | Buy with $10K | Off the plan Sydney | First Time Home Buyers MortgageRhodes Bay | Off the plan Sydney | Secure with $10k and $682 x 113 weeks
Some loans offer features that make managing your mortgage easier.
An offset account is a savings or transaction account linked to your home loan. The money in it reduces the loan balance used to calculate interest.
Example: If you owe $400,000 and have $20,000 in your offset, you only pay interest on $380,000.
Allows you to access extra repayments you’ve made if needed.
Great for:
Check whether your loan allows additional repayments without penalties. This helps you pay off the loan faster and reduce interest.
Coposit | Buy with $10K | Off the plan Sydney | First Time Home Buyers MortgageAuburn Square, North Village | Off the plan Sydney | Secure with $10k and $399 x 108 weeks
If you’re buying your first home in Australia, you may be eligible for:
These can reduce upfront costs and make mortgage repayments easier. Always check eligibility and state-specific rules.
Coposit | Buy with $10K | Off the plan Sydney | First Time Home Buyers MortgageHorizon Hurstville | Off the plan Sydney | Secure with $10k and $416 x 55 weeks
Coposit lets you secure an off-the-plan home with no upfront deposit. Instead of saving tens of thousands before you can buy, you make manageable weekly payments while your new home is being built.
Coposit advantages:
This gives you time to organise your finances, research the right mortgage, and enter the market sooner.
Coposit | Buy with $10K | Off the plan Sydney | First Time Home Buyers MortgageERA Newcastle | Off the plan Newcastle | Secure with $10k and $593 x 38 weeks
Speaking with a mortgage broker or lender can help match you with a product that fits your needs.
Coposit | Buy with $10K | Off the plan Canberra | First Time Home Buyers MortgageThe Markets Residences | Off the plan Canberra | Secure with $10k and $593 x 38 weeks
The right mortgage is just as important as the right property. Whether you choose fixed, variable, or split — understanding your options is key.
With Coposit, you can secure a new home while preparing for the right loan. Browse off-the-plan properties and start your journey today.
Share this article
Follow Coposit:
© 2025 Copyright Coposit.
