As a pinch and a punch for the first day of the month, ME raised its fixed owner occupier home loans for one, two and three years paying principal and interest (P&I) by between 10 and 30 basis points.
The rates are now:
- Flexible Fixed 1 Year: 10 basis point rise to 2.54% p.a. (4.17% p.a. comparison rate*)
- Flexible Fixed 2 Years: 30 basis point rise to 2.64% p.a. (4.03% p.a. comparison rate*)
- Flexible Fixed 3 Years: 30 basis point rise to 2.74% p.a. (3.93% p.a. comparison rate*)
ME's packaged loans also received the same treatment, and to get the most competitive rates borrowers must have a minimum 20% deposit i.e. 80% LVR.
This represents a partial reversal of ME's decision on 26 March to slash rates by up to 134 basis points as a discount spurred on by coronavirus.
At the time, ME CEO Jamie McPhee said that by offering its lowest ever suite of fixed rate home loan packages, ME was helping borrowers to reduce their repayments during this difficult time.
“Fixed rates provide borrowers with repayment certainty," Mr McPhee said.
"By offering record-low 1-, 2- and 3-year fixed rates and competitive rates across a range of other terms, borrowers can achieve peace of mind by locking in a historically low repayment to help them through this challenging period.”
On the decision to hike a number of fixed rates last week, a ME spokesperson told Savings.com.au it's "all just the usual adjustments in market position."
However, ME did cut rates on its owner occupier fixed four year loans by 10 basis points, and by 20 basis points for five year fixed terms.
Additionally, even with the rate hike, ME's fixed home loan rates are still very competitive, and are comparable to variable home loan rates, as seen below.
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.04% p.a. | 6.06% p.a. | $2,408 | Principal & Interest | Variable | $0 | $530 | 70% | Featured Online ExclusiveUp To $4K Cashback |
| |||||||||
5.99% p.a. | 5.90% p.a. | $2,396 | Principal & Interest | Variable | $0 | $0 | 80% | Featured Apply In Minutes |
|
Other home loan rate cuts
Marketwide, again, the bulk of cuts were made to fixed loan products.
CUA cut its one and two year fixed investor loans paying P&I (principal and interest) by up to 101 basis points (more details below) in the past week.
Larger cuts by up to 140 basis points were made to CUA's interest only (IO) loans as well, but for the sake of comparison we'll look solely at P&I products.
Other lenders to cut in the past week include Hume Bank, UBank, ME Bank, Sydney Mutual, and Endeavour Mutual, continuing the narrative of customer-owned banks cutting.
CUA
Cuts were made primarily to investment home loans, fixed between one and five years, and include:
- 1 Year Fixed Investor P&I: 101 basis point cut to 2.69% p.a. (4.82% p.a. comparison rate*)
- 2 Year Fixed Investor P&I: 101 basis point cut to 2.69% p.a. (4.62% p.a. comparison rate*)
- 3 Year Fixed Investor P&I: 45 basis point cut to 2.69% p.a. (4.44% p.a. comparison rate*)
- 5 Year Fixed Investor P&I: 71 basis point cut to 2.99% p.a. (4.23% p.a. comparison rate*)
Hume Bank
Hume Bank made a wide variety of cuts across both owner occupier and investment loans. Key cuts are below:
- 2 Year Fixed Intro P&I 70%: 65 basis point cut to 2.29% p.a. (4.06% p.a. comparison rate*)
- First Home Starters Package 2 Year Fixed Intro 150k+: 20 basis point cut to 2.39% p.a. (3.87% p.a. comparison rate*)
And for investors...
- Investment P&I Fixed 1 Year: 20 basis point cut to 2.99% p.a. (4.85% p.a. comparison rate*)
- Investment P&I Fixed 2 Years: 40 basis point cut to 2.79% p.a. (4.63% p.a. comparison rate*)
- Investment P&I Fixed 3 Years: 40 basis point cut to 2.79% p.a. (4.46% p.a. comparison rate*)
UBank
UBank was another lender that cut fixed investment loans - this time by up to 50 basis points.
- Inv UHomeLoan Fixed 1 Year P&I: 45 basis point cut to 2.44% p.a. (3.57% p.a. comparison rate*)
- Inv UHomeLoan Fixed 3 Year P&I: 40 basis point cut to 2.44% p.a. (3.30% p.a. comparison rate*)
- Inv UHomeLoan Fixed 5 Year P&I: 50 basis point cut to 2.74% p.a. (3.26% p.a. comparison rate*)
Sydney Mutual Bank & Endeavour Mutual Bank
Have a Captain Cook of Endeavour's home loan rate cuts, as well as Sydney Mutual's - the two mutual banks merged in 2019 and feature many of the same products.
- Investment Fixed P&I 1 Year: 35 basis point cut to 2.69% p.a. (3.46% p.a. comparison rate*)
- Investment Fixed P&I 2 Year: 35 basis point cut to 2.69% p.a. (3.40% p.a. comparison rate*)
- Investment Fixed P&I 3 Year: 35 basis point cut to 2.64% p.a. (3.32% p.a. comparison rate*)
- Investment FIxed P&I 5 Year: 35 basis point cut to 3.19% p.a. (3.42% p.a. comparison rate*)
And for owner occupiers looking for a variable rate:
- Basic Variable Home Loan: 10 basis point cut to 2.87% p.a.(2.93% p.a. comparison rate*)
- First Home Buyer Basic: 10 basis point cut to 2.87% p.a. (2.90% p.a. comparison rate*)
- First Home Buyer Standard: 10 basis point cut to 2.97% p.a. (3.00% p.a. comparison rate*)
Ready, Set, Buy!
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Brooke Cooper
Harry O'Sullivan
Staff Writers
