Home Loan Basics

Home Loan Basics

Understand Interest and Fees

A lender charges fees and interest when it provides home loans. What are these and what are they for? We'll explain here.


A bank or lender will charge you interest in exchange for the benefit of borrowing money. The interest rate charged on your home loan will depend on the loan term and type of loan type taken. See our 'Get familiar with home loan types' guide, linked in related guides below, for more information on the different types of loans available.

For example, you borrow $100,000 for one year on an interest only home loan, with an interest rate of 5.00%. The total interest cost for borrowing the $100,000 is $5,000.


While obtaining and repaying your home loan, you may come across different fees associated with the loan. Below are some of the most common fees which you may encounter on your home loan journey:

Loan application fee

Loan top-up fee


Rate lock amendment fee

Early repayment fee

Discharge fee

Default fee

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