Loans.com.au has cut its Smart Home Loan interest rate to 2.53% p.a (2.55% p.a comparison rate) today.
The rate is available to borrowers with a maximum loan-to-value ratio (LVR) of 75% and is one of the market's leading variable rates, according to Savings.com.au research.
The online lender has cut all variable principal and interest loans by 25 basis points and all variable interest only loans (including construction loans) by 10 basis points.
No changes have been made to fixed rates, with all rates effective from Tuesday 10 March.
The decision to reduce variable rates follows the Reserve Bank’s (RBA) 25 basis point cut to the cash rate last week, taking it to a record low 0.50%.
Some of the other notable cuts include:
- Smart Home Loan LVR 80% reduced by 25 basis points to 2.63% p.a (2.65% p.a comparison rate)
- ZIP Home Loan reduced by 25 basis points to 2.83% p.a (2.85% p.a comparison rate)
- Offset variable owner-occupier 80-90% LVR reduced by 25 basis points to 2.87% p.a (2.89% p.a comparison rate)
- Offset variable investor 80-90% LVR reduced by 25 basis points to 3.54% p.a (3.56% p.a comparison rate)
- Owner-occupier construction loan reduced by 10 basis points to 4.01% p.a (3.51% p.a comparison rate)
Check out how the new rate matches up to some of the most competitive home loan rates currently on offer below.
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. Introductory rate products were not considered for selection. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term. Rates correct as at 03 August 2020. View disclaimer.
Managing Director Marie Mortimer said the cut on the standard variable rate for new and existing customers would ensure that loans.com.au remained a price leader in home loans.
“This is an amazing rate that we are only able to offer because of our super-efficient online-lending model”, Ms Mortimer said.
“Home owners who borrowed from a big bank should be taking the opportunity to shop around for a refinance now because we are offering rates the big banks simply can’t match.”
Loans.com.au’s home loans are now at record-low rates, with every Owner-Occupied Principal & Interest loan now offered at well below 3.00%, including loans with Redraw Offset Facilities.
Ms Mortimer said that many people didn’t realise the big savings they could make over time by switching to a lower rate home loan.
“For most people their home loan is the biggest financial commitment they will make in their lives so it is crucial to keep the costs down as much as possible.”
“Our research shows that most people who refinance find it is easier than they expected and wish they had moved earlier, so it really is worth the time to find out how much you could save and then grab one of these incredible rates.”
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 2019) 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 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.
- Baby Boomers drove home renovations prior to HomeBuilder and COVID-19
- "Slim pickings" for Queensland rentals
- How to finance your block of land
- International fintech Revolut launches in Australia today
- Loans for fractional property investing are now a thing