ANZ cuts variable mortgage rates by up to 90 basis points - but there's a catch

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on April 23, 2021
ANZ cuts variable mortgage rates by up to 90 basis points - but there's a catch

ANZ has slashed variable rates on its Breakfree mortgage by up to 90 basis points, making it the lowest variable rate package among the big four banks.

The bank's new rate on its Breakfree Standard variable loan is 2.99% p.a. (3.42% p.a. comparison rate*) for owner-occupiers making principal and interest (P&I) repayments with 80% LVR. 

But the catch is that only new customers will be eligible for the lower rate, meaning existing borrowers will miss out. 

Related: What is a package home loan?

ANZ also reduced rates for owner-occupiers making interest-only (IO) repayments with 80% LVR by 90 basis points, taking the new rate to 3.54% p.a. (3.58% p.a. comparison rate*).

Investors won't miss out either: the bank reduced rates for investors making P&I repayments with 80% LVR on the Breakfree package by 90 basis points to 3.59% p.a. (4.00% p.a. comparison rate*). 

Investors making IO repayments with a 80% LVR also received the 90 basis point cut to 3.84% p.a. (4.06% p.a. comparison rate*). 


Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers

Lender

Variable
More details
  • Min 30% deposit
  • No monthly or ongoing fees, add 0.10% for offset
  • Unlimited redraws

Variable Home Loan (LVR < 70%)

  • Min 30% deposit
  • No monthly or ongoing fees, add 0.10% for offset
  • Unlimited redraws
Variable
More details
REFINANCE ONLY
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
REFINANCE ONLY

Variable Rate Home Loan – Refinance Only

  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Variable
More details
AN EASY DIGITAL APPLICATION
  • No ongoing fees - None!
  • Unlimited additional repayments
  • Easy online application, find out if you're approved quick!
  • Redraw- Access your additional payments if you need them
  • Use the app to get loan insights to help you pay off your home loan faster
AN EASY DIGITAL APPLICATION

Neat Variable Home Loan (Principal and Interest) (LVR < 60%)

  • No ongoing fees - None!
  • Unlimited additional repayments
  • Easy online application, find out if you're approved quick!
  • Redraw- Access your additional payments if you need them
  • Use the app to get loan insights to help you pay off your home loan faster
Variable
More details
NO ONGOING FEES
  • No ongoing fees - None!
  • Unlimited additional repayments
  • Easy online application, find out if you're approved quick!
  • Redraw- Access your additional payments if you need them
  • Use the app to get loan insights to help you pay off your home loan faster
NO ONGOING FEES

Yard PAYG Home Loan (Principal and Interest) LVR ≤ 80%

  • No ongoing fees - None!
  • Unlimited additional repayments
  • Easy online application, find out if you're approved quick!
  • Redraw- Access your additional payments if you need them
  • Use the app to get loan insights to help you pay off your home loan faster

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of August 10, 2022. View disclaimer.


This marks the first variable rate cut by a major bank since September last year, with cuts to fixed rates having been the focus for banks lately.

Last week Bankwest, Newcastle Permanent, and Greater Bank all raised rates on fixed home loan products, while Adelaide Bank recently hiked some of its variable interest rates by up to 15 basis points.

That could be a sign that banks have forecast their wholesale funding costs will rise in the coming months and years and that interest rates could start rising sooner than anticipated, despite Reserve Bank governor Dr Philip Lowe repeatedly stating the official cash rate will remain at 0.10% until at least 2024.

Read more: Why are home loan rates climbing when the cash rate is still 0.10%?

What other lenders cut home loan interest rates this week?

AMP Bank

  • 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*)

BCU

  • 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*)

Photo by pear285 via Flickr



Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. 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. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.

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author-avatar
Emma Duffy is Assistant Editor at Your Mortgage and  Your Investment Property Mag, which are part of the Savings Media Group. In this role, she manages a team of journalists and expert contributors committed to keeping readers informed about the latest home loan and finance news and trends, as well as providing in-depth property guides. She is also a finance journalist at Savings.com.au which she joined shortly after its launch in early 2019. Emma has a Bachelor in Journalism and has been published in several other publications and been featured on radio.

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