Reduce Home Loans — Eco Variable Review (2026)
Rates and conditions verified 22 May 2026
Rates can change without notice. Last verified: 22 May 2026 (AEST). Please confirm details on the bank’s official page.
OO P&I rate
5.94%
p.a. variable ≤80% LVR
Comparison rate
6.00%
p.a. ($150k / 25yr)
Ongoing fees
$0
no monthly or annual fees
About Reduce Home Loans
Reduce Home Loans is an Australian non-bank lender that has won Money magazine's "Australia's Cheapest Home Loan" award multiple times since 2016. The Eco Home Loan Variable is their flagship owner-occupied product, offering a competitive 5.94% p.a. variable rate with no monthly or annual fees.
As a non-bank lender, Reduce operates from a single head office without branch overheads — a model that allows them to consistently undercut the major banks on rate. Loans are serviced by dedicated personal finance managers rather than branch staff.
Note: Reduce Home Loans previously operated at reduce.com.au but has moved to reduceloans.com.au. The old domain is no longer active.
Current Rates
| Purpose | LVR | Rate | Comp. rate |
|---|---|---|---|
| OO P&I | ≤80% | 5.94% p.a. | 6.00% p.a. |
| Investment P&I | ≤60% | 6.19% p.a. | 6.25% p.a. |
| Investment P&I | ≤80% | 6.29% p.a. | 6.25% p.a. |
Verified 22 May 2026. Variable — check reduceloans.com.au for the latest rates.
Fees
| Application fee | $0 |
| Establishment fee | $0 |
| Monthly fee | $0 |
| Annual fee | $0 |
| Settlement fee | $0 |
| Valuation fee | At cost (~$400) |
| Legal fees | At cost (~$225) |
Pros and Cons
Pros
- ✓ Competitive 5.94% OO P&I rate — below Macquarie, HSBC, and Westpac
- ✓ $0 monthly and annual fees
- ✓ Unlimited extra repayments
- ✓ Free unlimited redraw facility
- ✓ Multi-award winner (Money magazine, Canstar)
- ✓ Minimum $150k loan — accessible to smaller borrowers
Cons
- ✗ No offset account
- ✗ Non-bank lender — not covered by government deposit guarantee
- ✗ No branches — online and phone only
- ✗ Third-party valuation and legal fees apply
How It Compares
- Pacific Mortgage Group: 5.59% — lower rate but also non-bank, no offset
- Unloan: 5.69% — refinance only, loyalty discount, CBA-backed
- Up Home: 5.70% — free 100% offset, no fees (offset is the key advantage)
- Macquarie: 5.84% — no offset on basic product, but larger established bank
- Reduce Eco Variable: 5.94% — $0 fees, redraw only, non-bank
- HSBC / Westpac: 5.99% — big-bank alternative with branch access
FAQs
What is the Reduce Home Loans Eco Home Loan variable rate?
The Reduce Home Loans Eco Home Loan Variable charges 5.94% p.a. variable (comp. 6.00% p.a.) for owner-occupied P&I loans at up to 80% LVR. The investment variable rate is 6.19% p.a. at ≤60% LVR, or 6.29% p.a. at ≤80% LVR.
Does Reduce Home Loans offer an offset account?
No — the Eco Home Loan Variable does not include an offset account. It offers a free unlimited redraw facility instead. If an offset account is important to you, consider Up Home (5.70% with free 100% offset) or Macquarie.
Are there any fees on the Reduce Home Loans Eco Home Loan?
No application fee, no monthly fee, and no annual fee. Third-party costs apply: valuation fee at cost (approximately $400) and legal fees at cost (approximately $225). No settlement fee.
Is Reduce Home Loans a bank?
No — Reduce Home Loans is a non-bank lender licensed under Australian Credit Licence No. 388053. It is not an ADI (Authorised Deposit-taking Institution) and is not covered by the government's Financial Claims Scheme. However, it is regulated by ASIC and subject to Australian responsible lending laws.
Information verified 22 May 2026. Rates variable and subject to change. Confirm current rates and conditions on Reduce Home Loans' website before applying. This is not financial advice.