Standard variable “Principle & Interest” loans are the most popular home loan in Australia. Interest rates go up or down over the life of the loan depending on the official rate set by the Reserve Bank of Australia and the lenders funding costs. Your regular repayments pay off both the interest and some of the principal. and they allow you to make extra repayments to reduce the balance quicker…any “extra” repayments are usually available as “redraw” ie accessible if you need the money.
You can also choose a basic variable loan, which offers a discounted interest rate but has fewer loan features, such as a redraw facility and repayment flexibility.