Loans.com.au cuts variable & fixed home loan rates

author-avatar By on July 08, 2020
Loans.com.au cuts variable & fixed home loan rates

Photo by Natalie Su on Unsplash

Online lender Loans.com.au has cut home loan rates on several of its mortgage products.

Effective today (Wednesday 8 July), loans.com.au has cut its Smart Home Loan 80 (owner-occupier, principal and interest) variable rate to 2.57% p.a. (2.59% p.a. comparison rate*), a cut of six basis points. 

In March, this loan's interest rate was 2.63% p.a (2.65% p.a comparison rate*). 

The online lender has also cut its two-year fixed rate for owner-occupiers paying principal and interest to just 2.29% p.a. (2.98% p.a. comparison rate*)

Other two-year fixed-rates fresh off loans.com.au's chopping block include: 

  • Owner-occupier, interest-only: 2.79% p.a (3.05% p.a. comparison rate*)
  • Investor, principal and interest: 2.69% p.a (3.34% p.a. comparison rate*)
  • Investor, interest-only: 2.99% p.a (3.38% p.a. comparison rate*)

In March, these rates were significantly higher: 

  • Owner-occupier, interest-only: 3.28% p.a (3.34% p.a. comparison rate*)
  • Investor, principal and interest: 3.08% p.a (3.61% p.a. comparison rate*)
  • Investor, interest-only: 3.48% p.a (3.66% p.a. comparison rate*)

These fixed-rate discounts are for LVRs up to 80%, and are for a limited time only for new customers. 

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.

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.

Managing Director of loans.com.au Marie Mortimer said the lower rates would be an unbeatable proposition for borrowers when combined with its faster processing times, which Ms Mortimer said were up to 10 times faster than some banks.

“Our rates are highly competitive but, just as important, we process most loans in 24-48 hours once we have received a completed application, while processing times at some major lenders have blown out to more than three weeks,” she said.

“Most buyers can’t wait for weeks for a simple answer on a loan application so our service advantage is becoming an ever greater draw card.”

Product

Max LVR

Repayments

Interest Rate

Comparison Rate

Smart Home Loan 80

80%

P&I

2.57%

2.59%

2 year fixed – Special Offer

90%

P&I

2.29%

2.98%

Source: Loans.com.au 

Ms Mortimer also said this "robust" online lending model has further demonstrated its value during COVID-19. 

“Just like online shopping, online lending has proven to be much more resilient than bricks-and-mortar to the challenges of the COVID-19 world and is quickly moving to centre stage,” Ms Mortimer said.

“We have been able to provide uninterrupted service throughout the crisis and ensured that Australians can easily get a competitively-priced property loan without leaving their home.”

Could now be the time to fix? 

As seen above, most of the changes made were to fixed-rate home loans

Many banks and lenders have been cutting fixed rate home loans recently, with one challenger lender even offering home loan rates under-2% mark on a three-year fixed mortgage. 

Mortgage Choice Chief Executive Officer Susan Mitchell said data shows 33% of borrowers opted to fix either part or all of their mortgage rate in the month up to June 2020. 

In comparison, just 14% did the same in the three months to February 2020. 

“Lenders have been pulling out all stops to compete for market share and over the last few months, we have seen cash back offers and interest rates lowered across both variable and fixed rate home loan products," Ms Mitchell said. 

"This fierce competition has encouraged a vast number of borrowers to switch their home loan providers and refinance their loans.

“The uncertainty created by the current economic downturn and the historic low fixed interest rates on offer are urging more borrowers to fix their home loan interest rates."

Buying an investment property or looking to refinance? The table below features home loans with some of the lowest fixed interest rates on the market for owner-occupiers.


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 2019. 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.

*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.

Latest Articles

author-avatar
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.

Get free insights & tips monthly

By subscribing you agree to the Savings Privacy Policy

Loading data please wait...

{{returnData.productName}}

Overview

Current Rate

{{returnData.currentRate | percentage:2}}

Comparison Rate*

{{returnData.comparisonRate | percentage:2}}

Rate Type

{{returnData.rateType}}

Advertised Rate

{{returnData.advertisedInterestRate}}

Comparison Rate*

{{returnData.comparisonRate}}

Monthly Repayment

{{returnData.monthlyRepayment}}

Interest Type

{{returnData.interestType}}

Total Interest Rate

{{returnData.totalInterestRate | percentage:2}}

Base Interest Rate

{{returnData.baseInterestRate | percentage:2}}

Bonus Interest Rate

{{returnData.bonusInterestRate | percentage:2}}

Total Interest Rate

{{returnData.totalInterestRate | percentage:2}}

Introductory Rate

{{returnData.introductoryRate | percentage:2}}

Introductory Term

{{returnData.introductoryTerm}}

Base Interest Rate

{{returnData.baseInterestRate | percentage:2}}

Term

{{returnData.term}}

Advertised Interest Rate

{{returnData.advertisedInterestRate | percentage:2}}

Interest Frequency

{{returnData.interestFrequency}}


Fees and Features

Ongoing Annualised Fee

{{returnData.annualFee}}

Upfront Fee

{{returnData.upfrontFee}}

Offset Account

Redraw

Principal & Interest

Interest Only

N/A{{returnData.interestOnly}}

Max loan to value ratio (LVR)

{{returnData.maxLVR | percentage:0}}

Lump sum repayments

N/A

Additional repayments

Maximum Loan Term

{{returnData.maximumLoanTerm}}

Upfront Fee

${{returnData.upfrontFee}}

Ongoing Monthly Fee

{{returnData.ongoingFees}}

Early Repayment Fee Applies

N/A

Vehicle Types

{{returnData.vehicleType}}

Maximum Vehicle Age

{{returnData.maximumVehicleAge}}

Pre Approval Available

N/A

Online Application

N/A

Account Keeping Fee

{{returnData.accountKeepingFee}}

Minimum Monthly Deposit

{{returnData.minMonthlyDeposit}}

Linked Account Required

N/A

Interest Calculated

{{returnData.interestCalculated}}

Interest Paid

{{returnData.interestPaid}}

Online Application

N/A

ATM

N/A

EFTPOS

N/A

Account Keeping Fee

{{returnData.accountKeepingFee}}

Minimum Monthly Deposit

{{returnData.minMonthlyDeposit}}

Linked Account Required

N/A

Interest Calculated

{{returnData.interestCalculated}}

Interest Paid

{{returnData.interestPaid}}

Online Application

N/A

ATM

N/A

EFTPOS

N/A

Minimum Deposit

{{returnData.minDeposit | currency : '$' : 0}}

Upfront Fees

{{returnData.upfrontFee | currency : '$' : 0}}

Annual Fees

{{returnData.annualFee | currency : '$' : 0}}

Notice Period to Withdraw

{{returnData.noticePeriodToWithdraw}}

Online Application

N/A

Automatic Rollover

N/A

Maturity Alert

N/A