In the past week, lenders such as Bank of Us and Bank First cut home loan rates by up to 64 basis points, as two others broke the 2.00% p.a. barrier.
In the past week, two lenders - Community First Credit Union and Easy Street Financial Services - introduced home loans below the 2.00% p.a. mark.
However, only one had a comparison rate under 2.00% p.a. to go with it.
Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner-occupiers.
Smart Booster Home Loan
- Discount variable for 1 year <=80% LVR
- No ongoing fees
- Unlimited redraw facility
Monthly repayments: $1,476
- Discount variable for 1 year
- No ongoing fees
- Unlimited redraw facility
Base criteria of: a $400,000 loan amount, variable, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. If products listed have an LVR <80%, they will be clearly identified in the product name along with the specific LVR. The product and rate must be clearly published on the Product Provider’s web site. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term.
In the wider market, it was a fairly subdued week for home loan interest rate reductions.
Two key lenders to make notable rate reductions were Bank of Us and Bank First.
Bank of Us - a Tasmanian-based lender that was the first to introduce a sub-2.00% home loan a few weeks back - made some further rate changes to its fixed products. Some key changes were:
- FlexiDiscount Fixed 3 Years 80%: 64 basis point cut to 2.49% p.a. (2.74% p.a. comparison rate*)
- FlexiDiscount Fixed 1 Year 80%: 44 basis point cut to 2.49% p.a. (2.78% p.a. comparison rate*)
A variety of other fixed owner-occupier loans were cut, including some 90% LVR loans.
Meanwhile, at the start of August Bank First also made some cuts, primarily to its variable 'Premier Package' home loans for both owner-occupiers and investors. Some key cuts were:
- Premier Package Inv 80%: 15 basis point cut to 2.88% p.a. (3.32% p.a. comparison rate*)
- Premier Package O/O 80%: 15 basis point cut to 3.33% p.a. (3.76% p.a. comparison rate*)
Various 90% LVR products were also cut.
Newcastle Permanent, AMP also cut
Newcastle Permanent made a few cuts to its 'Real Deal' home loans, with some as special offers. Some key cuts were:
- Real Deal P&I 80% Special Offer: 13 basis point cut to 2.59% p.a. (2.63% p.a. comparison rate*)
- Real Deal P&I 80% Inv Special Offer: 12 basis point cut to 2.99% p.a. (3.03% p.a. comparison rate*)
Similar loans across different maximum LVRs and ones paying interest-only were also cut.
Meanwhile, AMP made just two cuts on Wednesday. They were to its variable 'Professional Package' home loans as a special offer:
- P&I 80% 100-499k: 14 basis point cut to 2.59% p.a. (3.00% p.a. comparison rate*)
- P&I 80% 500k+: 10 basis point cut to 2.59% p.a. (3.00% p.a. comparison rate*)
Note that as with most lenders, special offers can be withdrawn at any time.
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): Credit Union Australia, 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.
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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