With a Standard Variable Rate Loan the interest rate varies throughout the term of the loan in line with movement in the market by the Australian Reserve Bank. This means that when interest rates fall, repayments also fall.
Conversely, when interest rates rise, so do your repayments. Repayments are calculated as principal and interest, generally over a 30 year terms. This is a flexible type of home loan which can have many features such as the ability to make extra repayments without any penalty, offset accounts, redraw facilities and repayment holidays.
