Which lenders introduced sub-2% home loans post-RBA cut?

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on November 06, 2020
Which lenders introduced sub-2% home loans post-RBA cut?

Photo by Kon Karampelas on Unsplash

The Reserve Bank's announcement on Tuesday caused a flurry of cuts, not least of which were quite a few lenders cutting home loans below 2% for the first time.

Most notable of which were three of the big four banks - CommBankWestpac and NAB - but borrowers must be willing to fix their home loan for four years.

  • CommBank: 'Wealth Package' for owner occupiers fixed for four years paying principal and interest cut by 100bps to 1.99% p.a. (comparison rate TBC*). Rate effective from 11 November.
  • Westpac: 'Premier Advantage Package' for owner occupiers paying principal and interest cut by 80bps to 1.99% p.a. (3.29% comparison rate*). Rate effective from 9 November.
  • NAB: 'Choice Package' for owner occupiers fixed for four years paying principal and interest cut by 81bps to 1.98% p.a. (comparison rate TBC*). Rate effective 6 November.

Note, these are packaged home loans, meaning you can expect the comparison rate to be in the 3.00% p.a. range, but watch this space.

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.

Lender
Advertised rate Comparison rate* Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

VariableMore details
LIMITED 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%
LIMITED 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%
VariableMore details
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
FixedMore details
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.

Rates correct as of January 22, 2022. View disclaimer.

A number of other smaller and challenger lenders also introduced or added some sub-2% home loans quickly after the Reserve Bank announced its decision.

Suncorp

Suncorp introduced its first sub-2% home loan, taking effect from 19 November.

It's a two-year fixed loan with a 1.89% p.a. advertised interest rate.

The comparison rate and the finer details are yet to be confirmed.

HSBC

HSBC also introduced a sub-2% home loan for owner occupiers willing to fix for two years.

Paying principal & interest, the home loan is packaged, and has a rate of 1.88% p.a. (2.98% p.a. comparison rate*), and is available from 19 November.

Reduce Home Loans

Reduce was one of the few lenders to make cuts to variable rates. 

  • Rate Cutter Variable 60% P&I: 12 basis point cut to 1.77% p.a. (1.83% p.a. comparison rate*)
  • Super Saver Variable 80% P&I: 20 basis point cut to 1.99% p.a. (2.05% p.a. comparison rate*)

UBank

Effective 13 November, UBank is cutting its three-year fixed range by 19 basis points down to 1.95% p.a. (2.36% p.a. comparison rate*).

It's for owner occupiers paying P&I, and there's no usual 'rate-lock' fee of $395 if borrowers settle on or before 31 March 2021.

The 2.36% p.a. comparison rate applies from 13 to 29 November, at which point it will revert to 2.25% p.a. when the variable rate changes take effect.

Homestar Finance

Homestar introduced a new 'Star Gold' home loan for owner occupiers paying P&I with a maximum of 60% LVR e.g. for those refinancing or with large deposits.

The rate is 1.79% p.a. (1.84% p.a. comparison rate*).

Pacific Mortgage Group

Pacific Mortgage Group was another lender that introduced a sub-2% home loan for borrowers with larger deposits or for those refinancing.

It cut its variable home loan paying P&I with a maximum LVR of 60% by 10 basis points down to 1.89% p.a. (1.89% p.a. comparison rate*). 

Freedom Lend

Freedom Lend cut its 'Freedom Variable' home loan for owner occupiers paying P&I with a maximum LVR of 70%.

The rate was cut by 20 basis points down to 1.97% p.a. (1.97% p.a. comparison rate*).


Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. 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. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.

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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.

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