Credit Comparison Rate (CCR)
The best place to start your home loan search
The Credit Comparison Rate is a tool to help borrowers compare one loan with another.
From the 1st July 2003 it became compulsory in Australia for financial institutions to publish the Comparison Rate in all advertising, including print media, radio, and television.
The Credit Comparison Rate is a calculation that takes into account the advertised interest rate as well as the upfront fees and charges and represents them as one easy to compare interest rate.
The Comparison Rate formula is commonly based on a loan of $150,000 over a 25 year period.
The Comparison Rate is designed to remove the confusion from home loan offers and exposes the impact of honeymoon rates and fees and charges on the total cost of the loan.
Credit Comparison Rate for Loans in Australia
Useful TipThe CCR is calculated by combining the interest rate with the establishment fee, valuation fee, and any ongoing fees but ignores loan features (like repaying a loan early without penalties) so it tends to present basic loans in a better light.
Take care that you are actually comparing loans that have a similar set of features.
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