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What is a comparison rate?

What is a comparison rate?

This is basically a means of comparing one loan to another from any provider in Australia. It includes all interest and known fees payable over the whole life of the loan and expresses that amount as an annual rate. This allows you to compare loans with different fee amounts, frequencies and timings as well as the base interest rate quoted. It is designed so that you can compare all the costs of the loan rather than just the interest rate.