While reviewing the loan plan by the borrower, which the lender offered at first, it seems like an attractive deal to them, as they need to understand its overall features and the overall cost of the loan product. This means that some lenders advertise an interest rate that may look suitable to the borrower at first, but it doesn’t go with their personal situation while considering the charges and ranges of fees that have been attached to the loan.

Therefore, to help borrowers in this situation, the Australian government has introduced the comparison rate as a primary requirement. This shows the actual cost of your home loan based on a set of assumptions, so the borrowers don’t have to work up the actual cost of their home loan on their own. In other words, it does make things easier for the borrowers.