Customer-owned banks slash home loan rates

By Harrison Astbury on December 04, 2020

Northern Inland Credit Union, BCU, Hunter United, and LCU all cut home loan interest rates recently, with a couple of new advertised rates under 2%.

Lenders have continued to lower their mortgage rates, despite December's cash rate remaining unchanged at 0.10%. 

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.

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Lender	Advertised rate	Comparison rate	Monthly repayment	Rate Type	Offset	Redraw	Ongoing Fee	Upfront Fees	LVR	Lump Sum Repayment	Additional Repayments	Pre-approval	as of September 26, 2021
	1.85%p.a.	2.21%p.a.	$1,449	Variable			$0	$520	80%				More details
FEATUREDLIMITED TIME OFFER	Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%) Fast turnaround times, can meet 30-day settlement For purchase and refinance, min 20% deposit No ongoing or monthly fees, add offset for 0.10%
FEATUREDLIMITED TIME OFFER Info More details Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%) Fast turnaround times, can meet 30-day settlement For purchase and refinance, min 20% deposit No ongoing or monthly fees, add offset for 0.10%
	1.99%p.a.	1.99%p.a.	$1,476	Variable			$0	$0	75%				More details
FEATUREDWIN YOUR HOME LOAN INTEREST FREE	Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only) WIN your home loan interest free and save up to $1.1 million. Refinance by 29 October. T&Cs apply. Refinance Only. Fast online application, refinance in minutes, not weeks. No Nano fees, Free 100% offset sub account. Mobile app. Visa debit card & instant payments.
FEATUREDWIN YOUR HOME LOAN INTEREST FREE Info More details Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only) WIN your home loan interest free and save up to $1.1 million. Refinance by 29 October. T&Cs apply. Refinance Only. Fast online application, refinance in minutes, not weeks. No Nano fees, Free 100% offset sub account. Mobile app. Visa debit card & instant payments.
	1.99%p.a.	1.99%p.a.	$1,476	Variable			$0	$0	60%				More details
FEATUREDYOU COULD WIN $100k TO PAY DOWN YOUR LOAN*	Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest) For a chance to win $100K towards your home loan, apply with Athena before Oct 31 & be approved by Dec 15 We lower your rate based off how much you’ve paid down your loan Automatic rate match
FEATUREDYOU COULD WIN $100k TO PAY DOWN YOUR LOAN* Info More details Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest) For a chance to win $100K towards your home loan, apply with Athena before Oct 31 & be approved by Dec 15 We lower your rate based off how much you’ve paid down your loan Automatic rate match
	1.99%p.a.	2.02%p.a.	$1,476	Variable			$0	$794	70%				More details
FEATUREDAN EASY ONLINE APPLICATION	Yard Home Loan (Principal and Interest) (Special) (LVR < 70%) Unlimited additional repayments Unlimited free redraws Optional 100% offset can be added for $120 p.a.^
FEATUREDAN EASY ONLINE APPLICATION Info More details Yard Home Loan (Principal and Interest) (Special) (LVR < 70%) Unlimited additional repayments Unlimited free redraws Optional 100% offset can be added for $120 p.a.^
	2.14%p.a.	2.16%p.a.	$1,507	Variable			$0	$0	60%				More details
FEATURED100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES	Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%) No upfront or ongoing fees 100% full offset account Extra repayments + redraw services
FEATURED100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES Info More details Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%) No upfront or ongoing fees 100% full offset account Extra repayments + redraw services

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Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

Product Features

• Fast turnaround times, can meet 30-day settlement
• For purchase and refinance, min 20% deposit
• No ongoing or monthly fees, add offset for 0.10%

Monthly repayments:$1,449

1.85%Advertised Rate (p.a.)

2.21%Comparison Rate (p.a.)

More details

Rates correct as of September 26, 2021. View disclaimer.

Northern Inland Credit Union introduced a couple of different home loans with an advertised interest rate below 2%, adding to the list of near 40 lenders to have already done so.

For example, the new 'Dream Value' home loan is 1.89% p.a. (2.28% p.a. comparison rate*).

The loan is variable, for owner occupiers paying principal & interest (P&I) with a maximum LVR of 60%, and is offered to new borrowers as a 'special offer' only. 

This is one of only a few products under 2% on a variable basi, as many are on a fixed basis instead. 

BCU also cut a fair few home loans for owner occupiers and investors alike.

The owner occupier two year fixed loan paying P&I was cut by 14 basis points down to 1.98% p.a. (3.76% p.a. comparison rate*).

For investors, the lowest rate to get a cut was the two year fixed loan paying P&I, cut by 21 basis points down to 2.18% p.a. (3.92% p.a. comparison rate*).

Meanwhile, Hunter United cut a few of its 'No Regrets' home loans by 10 basis points.

For first home buyers, the variable rate is now 2.69% p.a. (2.69% p.a. comparison rate*), and borrowers can have up to 90% LVR.

Source: Tenor GIF

LCU also introduced a home loan under 2% - its 'Introductory Home Loan' is 1.99% p.a. (3.12% p.a. comparison rate*).

It's a three-year fixed rate for new owner occupiers paying P&I. 

Reduce Home Loans also cut a few of its 'Home Owners Dream' loans by 25 basis points.

For example, its one-year fixed loan with a maximum LVR of 80% is now 1.94% p.a. (2.71% p.a. comparison rate*).

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Photo by Rob Laughter 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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Harrison Astbury Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison is passionate about breaking down complex financial topics for the everyday consumer.