HOME > BLOG > Home Loan Advice > Understanding Core Interest Rates

Disclosures around interest rates may refer to core interest rates. Here is a brief outline of what they are and how they apply to the interest rate on your home loan.

Loan documents can be complicated and you can often come across terms that you don’t understand.

Disclosures around interest rates may refer to core interest rates. Here is a brief outline of what they are and how they apply to the interest rate on your home loan.

All lenders are required under the National Consumer Credit code to publish interest rate changes in national newspapers. For simplicity many lenders will advertise a single “core” rate that applies to all their distribution platforms. This is a benchmark rate, with the actual rate that applies to your loan being the core rate less the margin that applies to your loan. The margin reflects the true position of your actual rate relative to the single advertised core rate.

As a current or future borrower, it is important to remember that Australian Credit providers are not able to change any interest rate without full disclosure in line with Australian laws. If there is a rate change, credit providers are required to provide their customers with the necessary notifications.

As you look through your loan contract, if there is a term you do not understand, you should take a moment to speak with your credit provider to ensure you understand the fine print.