New year, new home loan rate cuts

By Harrison Astbury on January 08, 2021

Maybe your New Year's resolution could be to review your home loan, as HomeStar Finance and QBank made some rate changes to ring-in 2021.

Let's face it - 2020 sucked for a lot of people (and 2021 is looking not much better) but those looking for a more affordable home loan were treated to a bevy of rate changes.

Two lenders have made some rate changes already, including HomeStar Finance, which cut on New Year's Day when most people were dozing off:

• Star Fixed 2 Years P&I 80%: 56 basis point cut to 1.88% p.a. (2.26% p.a. comparison rate*)

HomeStar also cut the equivalent 70% LVR loan by 46 basis points. Borrowers must apply for this 'special' rate by 31 January and have the loan settled by 30 April.

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

Loan amount

Loan purposeRefinance

Compare

OverviewFeaturesFeesOtherFilters

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 October 28, 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%
	1.89%p.a.	1.89%p.a.	$1,457	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
	1.99%p.a.	1.99%p.a.	$1,476	Variable			$0	$0	75%				More details
FEATUREDREFINANCE IN MINUTES, NOT WEEKS	Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only) Refinance only. Fast online application No Nano fees. Free 100% offset sub account Mobile app, Visa debit card & instant payments
FEATUREDREFINANCE IN MINUTES, NOT WEEKS Info More details Nano Home Loans Variable Owner Occupied, Principal and Interest (Refinance Only) Refinance only. Fast online application 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	$530	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.^

Advertisement

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 October 28, 2021. View disclaimer.

Conversely, HomeStar also had a few home loan rate rises, presumably as special offers came to an end, including some investment home loans raised by up to 46 basis points.

Some owner occupier loans were also hiked by up to 54 basis points.

QBank was another institution to make some cuts to home loans under 2%.

• Fixed 2 Years: 2 basis point cut to 1.97% p.a. (3.54% p.a. comparison rate*)
• Fixed 4 Years: 2 basis point cut to 1.97% p.a. (3.26% p.a. comparison rate*)

These home loans are for owner occupiers paying principal and interest (P&I) with a maximum loan-to-value (LVR) of 90%, and are 'special offers', meaning they could change at any time.

QBank also tinkered with its home loans, raising others by up to 15 basis points, as new 'special offers' took effect and as old offers expired.

There are now at least 35 lenders with a home loan below the 2% advertised rate mark.

---

Photo by Immo Wegmann 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.

Latest Articles

• Australian consumer credit demand rises: Equifax October 28, 2021
• New APRA rule effective 1 November: How have banks responded? October 28, 2021
• Alarms sounded on incoming rental affordability 'crisis' October 28, 2021
• CBA pencils in a November 2022 RBA cash rate hike October 28, 2021
• Australia's median house price edges ever closer to $1 million October 28, 2021

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.