Fixed home loan? Variable home loan? Instead of choosing between a fixed or variable home loan, you may consider “getting the best of both worlds” by taking out a split home loan.

In this article, I will be talking about split home loan pros and cons to help you decide whether or not this is the right loan option for you.

What is a Split Home Loan?

A split home loan enables you to split your home loan into different accounts that draw different interest rates. You can allot as much as you want to each account, as long as it is allowed by your lender. The allocation of your preferred interest rate model is normally up to the investor, so you can split your loans 60/40, 80/20, 50/50, or however you prefer.

Generally, split home loans are used by investors who want both flexibility and security. It is ideal for investors who want to be able to manage the risk of rising interest rates while still being able to maintain the ability to make extra repayments.

Split Home Loan Pros and Cons

Below, I will list down some split home loan pros and cons to help you determine if this type of loan is the right option for you.


By splitting your home loan into two – one fixed and the other variable – you can enjoy the advantages of both while reducing the effect and risk on each option. In particular, a split home loan offers the following advantages:


Just like everything else, a split home loan comes with its own disadvantages as well. Here are some of them:

The Takeaway

All types of home loans have accompanying pros and cons.

If you need help in analyzing split home loan pros and cons and deciding whether to use it or not, let me help you. With my expertise, I can guide you and help you see if this type of loan works best for you. Feel free to send me a message at [email protected]. Let’s talk about your needs today.

If you need expert advice, don’t hesitate to send me a message at [email protected]. I look forward to hearing from you!


Will Bell Mortgage Broker is a mortgage and finance broker based in Melbourne specializing in residential home loans.  Will is all about the average Australian understanding just enough of the broader economy to take action on your own personal economy.  He is the host of the My Personal Economy Podcast which you can check out here.

Additionally, you can follow him on Facebook


Services we offer:

  • First Home Buyer Loans
  • Property Investment Loans
  • Mortgage Consultation
  • Loan Prequalification
  • Debt Consolidation
  • Refinancing
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