Australians are being urged to refinance their home loans to get a better deal.

New Australian Bureau of Statistics data found in December nearly 21,000 Australians refinanced their mortgages to score a better deal — the highest level reached since 2010.

But borrowers are being urged to take notice of their loans after multiple lenders this week made out-of-cycle rate increases to variable home loan deals including lenders Yellow Brick Road and Australian Unity.

EXPLORE MORE: Find the best variable home loan deal

Home Loan Experts’ managing director Otto Dargan said loyalty is costing Australian borrowers big by lenders “offering crazy discounts to new customers” and he encouraged them to look beyond having a mortgage with one of the big banks.

“Anyone who purchased a property more than two years ago is paying too much in interest,’’ he said.

“There’s big differences between rates as well, in particular with several smaller banks and building societies who are coming in with great offers below what the major lenders are offering their best clients.’’

Variable home loan rates are as a low as 3.98 per cent.Source:istock

Mr Dargan said some variable rate deals available are as low as 3.98 per cent which is 1.58 per cent lower the big banks’ standard variable rate of 5.56 per cent.

Yellow Brick Road spokeswoman Lyndsey Douglas said their recent rate hike to the Rate Smasher loan from 3.91 per cent to 4.07 per cent was a result of the “increased cost of funding impacts.”

Yellow Brick Road spokeswoman Lyndsey Douglas said recent rate hikes were due to funding pressures.Source:News Corp Australia

Financial comparison website Finder.com.au's spokeswoman Bessie Hassan encouraged more borrowers to refinance their loans to save themselves money.

“It’s fantastic that Australians are becoming savvier with their home loans and seeking out better deals for their personal situations,’’ she said.

“The cash rate is currently at a historical low and providers are offering among the lowest rates ever seen — some borrowers can potentially save thousands of dollars per year by making the switch to a better deal.”

The Reserve Bank of Australia has kept the cash rate at a record low of two per cent since May last year and it’s not expected to move when they meet again next month.

sophie.elsworth@news.com.au

LOWEST INTEREST RATE DEALS

Variable home loans, interest rate, maximum loan-to-value ratio

1. Click Loans Online Variable 3.98 per cent, 70 per cent LVR

2. HSBC Home Loan Value Loan 3.99 per cent, 90 per cent LVR

3. Easy Street Basic Variable Home Loan 3.99 per cent, 80 per cent LVR

4. Beyond Bank Variable Low Rate Home Loan 3.99 per cent, 70 per cent

5. IMB Budget Home Loan 3.99 per cent, 70 per cent LVR

6. CUA Fresh Start Basic Variable Home Loan 3.99 per cent, 70 per cent LVR

7. Bank of Queensland Clear Path Variable Rate Home Loan, 3.99 per cent, 95 per cent

Three-year fixed rate home loans, interest rate, maximum loan to value ratio

1. Greater Building Society Ultimate Home Loan, 3.99 per cent, 80 per cent

2. Bank of Queensland fixed rate home loan, 3.99 per cent, 95 per cent

3. IMB Platinum, 4.05 per cent, 80 per cent

4. UBank U Home Loan, 4.08 per cent, 80 per cent

5. Beyond Bank Total Home Loan Package, 4.09 per cent, 95 per cent

6. CUA Fixed Rate Home Loan, 4.09 per cent, 95 per cent

Source: Finder.com.au.