In the 2022-23 financial year, 424 bank branches closed across Australia. According to APRA, branch numbers have declined by 37% since 2017, with banking services increasingly moving online. While branches remain important, particularly in regional areas, the majority of Australians these days are applying for home loans through a computer or phone screen.

Online home loan lenders in Australia

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Refinancing

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Lender	Home Loan	Interest Rate	Comparison Rate*	Monthly Repayment	Repayment type	Rate Type	Offset	Redraw	Ongoing Fees	Upfront Fees	LVR	Lump Sum Repayment	Additional Repayments	Split Loan Option	Tags	Features	Link	Compare
loans.com.au	loans.com.au Variable Basic Cashback Home Loan (Principal and Interest) (LVR < 70%)	6.04% p.a.	6.06% p.a.	$2,408	Principal & Interest	Variable			$0	$530	70%				Featured Online ExclusiveUP TO $4K CASHBACK	Immediate cashback upon settlement $2000 for loans up to $700,000 $4000 for loans over $700,000	More details	Compare
Unloan	Unloan Variable Rate Home Loan LVR < 80%	5.99% p.a.	5.90% p.a.	$2,396	Principal & Interest	Variable			$0	$0	80%				Featured APPLY IN MINUTES	No application or ongoing fees. Annual rate discount Unlimited redraws & additional repayments. LVR <80% A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.	More details	Compare
loans.com.au	loans.com.au Variable Home Loan (LVR < 90%)	6.04% p.a.	6.06% p.a.	$2,408	Principal & Interest	Variable			$0	$530	90%						More details	Compare

Online home loans at the big banks

Many of Australia’s largest traditional banks have gotten in on the action, developing subsidiaries or special products that are exclusively online.

Non bank online lenders

There are also plenty of non bank lenders who offer entirely online home loans. Some of the most prominent include:

• loans.com.au

• Athena

• Reduce Home Loans

• homeloans.com.au

• WLTH

In 2021 a non-bank lender called Nano shook up the home loan market with what it claimed was a ‘10 minute mortgage’. Borrowers with simple applications could see their home loan approved, via app or the web, in as little as 10 minutes.

This placed application times at the fore of the home loan battleground, which have since improved at the traditional banks. Unfortunately Nano was never profitable and in 2022 its mortgage book was acquired by AMP.

How do I apply for an online home loan?

Much of what you’ll need to provide for an online only home loan will be similar to more conventional products, but will just be done online. You might need to upload documents to a cloud-type platform.

Just like applying for a conventional home loan, online-only lenders might need to see some or all of the following as part of your application.

• Identity documents (could include drivers license, passport, medicare card)

• Proof of income (Payslips or equivalent for self-employed borrowers)

• Your outstanding debts

• Details about your usual household expenses

If your home loan application is straightforward, everything can usually be done online. If your application or income details are more complex, you may have to ring up the lender’s call centre.

Read more: How to apply for a home loan

Benefits of an online home loan

Convenience

Online only home loans allow you to complete the entire application process, as well as service your home loan, from your bedroom. You can submit all your documents online, and might not even need a phone conversation to get approval for the loan.

Lower rates and fees

Since online only lenders tend to have less overhead costs than larger banks, online loans often have favourable rates compared to more conventional alternatives. There are also often fewer account keeping fees and other additional costs.

Faster approval process

One of the biggest advantages technology brings to the home loan application process is how quick approvals can now be processed. Provided all documents are provided

Some online lenders even have mostly automated the evaluation processes.

Laura Osti, Tiimely spokesperson, said the quickest home loan approval time there is 58 minutes, and only 10 minutes of that time is human assessment time.

“We have digitised our credit policy and have created a series of data models to make lending recommendations for our human assessment team,” she told Infochoice Group in 2021.

Potential customers worried about being at the mercy of a robot can relax though, because the final decision will still be made by a human.

Read more: Home Loan approval times

Transparency with rates

Online lenders typically have a streamlined product range, with only a couple of different loans available. Compare that to a traditional big bank, who will likely have dozens of different variations of the home loans on offer, all with different rates. In many cases, the lowest available rate isn’t immediately apparent, so you might need a savvy mortgage broker or an inside source to get the lower rate.

Online lenders tend to be much more transparent. The Up Bank website for example has a ‘No need to haggle’ statement, explaining that the advertised rates are the lowest available, with no reductions upon negotiation. This means it’s easier to compare rates reliably and quickly.

Downsides of online home loans

Security and long term stability concerns

Given the high profile collapse of some of Australia’s most prominent neobank start ups, some borrowers will no doubt be apprehensive about going outside of the traditional banking system. If you have a loan with a lender who goes under, administrators will likely sell the loan book to another lender, which you won’t have much control over.

Security is another potential concern. Very few people actually understand how cloud type storage works, so you could be forgiven for being nervous about uploading sensitive data like your drivers licence or tax return. Many online lenders have multi-factor authentication, as well as other security measures to protect your information, so its worth looking into this if this is a concern for you.

Smaller servicing teams

Online lenders typically employ far fewer staff members than more conventional banks, which is part of how they keep costs so low and can offer such low rates. The flip side of this though is if your application is unusual (you have seasonal income, for example), there aren’t as many staff available to work with you to help you come up with solutions.

There may not be a number to call or branch to visit - everything will need to be done via web, app, or chatbot.

At major banks, you will typically have someone in the lending team assigned to your application, until you’re either approved or knocked back. They are likely to spend much more time on your application, and therefore get a better understanding of your unique case, then a customer service worker at an online lender who is working through a backlog of requests and complaints.

Usually only serve straightforward borrowers

If you have extra needs - such as if you’re self-employed, low-doc, have non-traditional income streams or a low deposit - online lenders may not be for you. For example, Unloan currently only allows refinances with a maximum 80% loan-to-value ratio.

This is to keep the mortgage book straightforward and consistent, and ensures lenders can deliver fast approval times. If you have extra needs you might need to visit a traditional bank.

This article was initially published in 2019, then updated in December 2023.