What is a split loan?

A split loan structures a single mortgage into two or more separate tranches within one account. Part of the balance sits on a fixed interest rate, while the remainder operates on a variable rate. Both portions remain under one facility agreement, so the borrower manages them through a single loan product rather than maintaining separate loans.

The fixed portion locks in a rate for a set term, protecting that slice of the debt from rate rises. The variable portion moves with market conditions, typically tracking the lender's standard variable rate. This arrangement lets borrowers choose their own ratio between stability and flexibility, without needing to set up and manage entirely separate loans or go through duplicate application processes.

Split loans appeal to Gold Coast borrowers who want to balance certainty on part of their debt while retaining the flexibility to redraw or benefit from rate falls on another part. If interest rates climb, the fixed tranche insulates that portion from the increase. If rates drop, the variable portion may deliver savings. The structure suits those uncertain about rate direction or wanting to stage their fixed commitments at different terms.

Each lender structures split loans differently, so terms, fee arrangements, and redraw conditions vary. Speaking with a mortgage broker helps clarify how a split loan fits your circumstances and what each institution actually offers.