AMP cuts fixed home loan rates while UBank increases

author-avatar By on April 30, 2021
AMP cuts fixed home loan rates while UBank increases

Two more key lenders have changed fixed home loan rates this week, with one increasing and the other decreasing.

As of today, online bank UBank, owned by NAB, increased one of its fixed home loan rates by 10 basis points, while AMP cut a number of its own fixed products by 11. 

These changes follow the substantial four and five-year fixed rate increases by Westpac on Wednesday, and are the latest in a slew of changes made to fixed mortgages in recent months. 


The table below displays a snapshot of some of the lowest fixed home loan rates from a variety of lenders.

UBank home loan rate increases 

Today UBank raised the interest rate on a single fixed home loan by 10 basis points. 

The UHomeLoan Fixed three-year loan with principal and interest (P&I) repayments has had its interest rate increased to 1.85% p.a from 1.75% p.a (comparison rate 2.24% p.a comparison rate*). 

This change applies to owner-occupiers only, and is available for customers with a maximum LVR of 80 (20% deposit minimum). 

Just this week, NAB, which owns UBank, had its purchase of neobank 86 400 confirmed, meaning 86 400 and UBank will eventually be merged together. 

UBank last changed home loan interest rates in January 2021, when it cut shorter-term fixed rates by 20 basis points. 

Related: Why are some fixed rates rising, despite the cash rate staying low? 

AMP home loan rate decreases 

Continuing the trend of shorter fixed-term interest rates staying low, AMP today cut a number of one to three-year fixed rates by up to 11 basis points. 

The 'Basic Fixed' and 'Professional Package Residential Fixed' mortgages saw interest rate haircuts, as long as the borrower is an owner-occupier with a minimum 10% deposit on P&I repayments. 

AMP's changes include the following: 

  • Basic Fixed P&I 2 yrs: 11 basis point cut to 2.08% p.a (2.78% p.a comparison rate*)
  • Basic Fixed P&I 3 yrs: 10 basis point cut to 2.09% p.a (2.72% p.a comparison rate*)
  • Professional Package Residential Fixed P&I 2 yrs 80% LVR: 11 basis point cut to 1.88% p.a (2.84% p.a comparison rate*)
  • Professional Package Residential Fixed P&I 2 yrs 80-90% LVR: 11 basis point cut to 1.98% p.a (3.10% p.a comparison rate*)
  • Professional Package Residential Fixed P&I 3 yrs 80% LVR: 11 basis point cut to 1.88% p.a (2.77% p.a comparison rate*)
  • Professional Package Residential Fixed P&I 3 yrs 80-90% LVR: 11 basis point cut to 1.98% p.a (3.01% p.a comparison rate*)

Related: What is a package home loan? 

Just a week prior AMP also took the axe to fixed interest rates for investors and interest-only (IO) borrowers:

  • Professional Package Investment Fixed P&I 2 years with 80% LVR: Cut by 25 basis points to 2.24% p.a. (3.72% p.a. comparison rate*)
  • Professional Package Investment Fixed P&I 2 years with 90% LVR and LMI: Cut by 25 basis points to 2.34% p.a. (3.74% p.a. comparison rate*)
  • Investment Basic Fixed P&I 2 years: Cut by 25 basis points to 2.44% p.a. (3.15% p.a. comparison rate*)
  • Professional Package Investment Fixed IO 2 years: Cut by 24 basis points to 2.44% p.a. (3.34% p.a. comparison rate*)
  • Investment Basic Fixed IO 2 years: Cut by 24 basis points to 2.54 p.a. (3.17% p.a. comparison rate*)

In April AMP also changed the total interest rate on its AMP Saver Account by increasing it 40 basis points to 1.25% p.a, which is now one of the market-leading rates for savings accounts

IMB, BCU among the other recent rate changes 

Not to be outdone, smaller lenders IMB and BCU cut various fixed interest rates. 

On Wednesday, IMB lowered the interest rate on its fixed investment loan for three-years (P&I) by 14 basis points, to a new rate of 2.35% p.a (3.33% p.a comparison rate*).

BCU meanwhile made the following rate changes: 

  • Residential Fixed P&I 1 year: Cut by 31 basis points to 1.67% p.a. (3.84% p.a. comparison rate*)
  • Investment Fixed P&I 1 year: Cut by 31 basis points to 1.87% p.a. (4.00% p.a. comparison rate*)
  • Investment Fixed IO 1 year: Cut by 31 basis points to 1.97% p.a. (4.01% p.a. comparison rate*)
  • Residential Fixed P&I 2 years: Cut by 20 basis points to 1.78% p.a. (3.66% p.a. comparison rate*)
  • Investment Fixed P&I 2 years: Cut by 20 basis points to 1.98% p.a. (3.82% p.a. comparison rate*)

Related: Experts warn of 'dangerous' fixed loan frenzy


Photo by Naseem Buras on Unsplash

 

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Great Southern Bank, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*Comparison rate is based on a loan of $150,000 over a term of 25 years. Please note the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees and costs savings, such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

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William Jolly joined Savings.com.au as a Financial Journalist in 2018, after spending two years at financial research firm Canstar. In William's articles, you're likely to find complex financial topics and products broken down into everyday language. He is deeply passionate about improving the financial literacy of Australians and providing them with resources on how to save money in their everyday lives.

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