With a variable rate home loan (also known as a floating rate home loan), the interest you pay on your home loan can go up or down.
If interest rates fall, you’ll pay less in interest and pay off your home loan faster as we keep your repayments the same. However, if it rises, your repayments may increase so you need to have the room in your budget to cope with higher repayments.
You'll have a minimum repayment amount which you'll pay on your set repayment date.
But you also have the flexibility to increase your repayments whenever you like or to make lump sum payments without paying a penalty. This can be handy if you come into some money like a pay rise or inheritance. If you want to reduce your repayments, you can also request this.