There are four major types of mortgages that are available in Australia either for the first time mortgage holder or for the individual who wants to refinance their mortgage. These four types of Australian home mortgage loan agreements are fixed interest rate loans, standard variable rate loans, basic variable rate loans and split rate home loans.

The fixed interest rate home mortgage loan has a set term that is usually no longer than five years. The typical term is between one and five years. When the term of this fixed rate mortgage loan expires the homeowner can then roll over the loan into a new loan with another fixed rate.  Another option is for the homeowner to roll it over into a variable rate. 

Mostly fixed rate loans are popular in Australia when the interest rates are rising. This prevents them from being the victims of shaky economics. However if interest rates fall the fixed rate can keep you paying more than is necessary. For instance if you took out a loan at six percent and rates for to six percent then you are paying more than you will be unable to take advantage of that. However it has been a long time in Australian financial history since mortgage rates have fallen and fixed rate mortgage loans are popular because they protect homeowners from being at the mercy of the times. 

However be prepared to pay more for a fixed interest rate loan. You will be paying higher fees to afford yourself the security.

Another popular type of Australian mortgage loan is the standard variable rate. It is the most common type of home loan in Australia. The biggest advantage of this loan is that you are not penalized for paying it off early by making extra or more frequent payments. 

Another nice feature of the standard variable loan in Australia is that it has something called the redraw feature. This means that you can borrow against the extra funds that you put in to pay of the loan early if you need to.

Another benefit is that it is possible to take your existing loan along with you if you decide to sell your current home. The fact that this type of Australian loan is transferable can help you save lots of money on loan fees.

Basic variable rate home loans are known for having the lowest interest rates available on the Australian loan market. However often high monthly fees balance the cheapness of the interest rates out. These loans sometimes have a redraw feature as well.