Flurry of banks cut fixed home loan rates to remain competitive

This comes as ABS data released earlier this month revealed to February 2023 refinancing numbers reached a record high of $13.6 billion as Aussies sought the best deals in the market. 

Australia’s largest bank was the first to make a move in the past week, cutting fixed home loan rates by up to 40 basis points. 

Following CommBank’s lead, ANZ has rounded out the week reducing fixed home loan rates by up to 60 basis points (0.60%). 

For new owner occupiers, key decreases across ANZ’s fixed home loan portfolio include:

• Residential Fixed 3 Years LVR ≤80%: 60 basis point decrease to 5.49% p.a. (6.21% p.a. comparison rate*).
• Residential Fixed IO 3 Years LVR ≤80%: 50 basis point decrease to 5.69% p.a. (6.27% p.a. comparison rate*).
• Residential Fixed 3 Years 80-90% LVR: 60 basis point decrease to 5.54% p.a. (6.37% p.a. comparison rate*).
• Residential Fixed IO 3 yrs 80-90% LVR: 50 basis point decrease to 5.74% p.a. (6.43% p.a. comparison rate*).

Aside from slashing fixed home loan interest rates, ANZ has increased rates across Simplicity Plus products for owners and investors by 10 basis points (0.10%). 

Bank Australia cuts fixed home loan rates by up to 1.01% p.a. 

Customer-owned Bank Australia cut fixed home loan rates in the past week across its portfolio by up to 101 basis points. 

Highlights of these decreases for owner occupiers across principal and interest (P&I) fixed rate loans include: 

• Basic Fixed 3 Years LVR ≤70%: 36 basis point decrease to 5.39% p.a. (5.33% p.a. comparison rate*).
• Basic Fixed 5 Years LVR ≤70%: 80 basis point decrease to 5.39% p.a. (5.35% p.a. comparison rate*).
• Basic Fixed 3 Years LVR ≤80%: 36 basis point decrease to 5.39% p.a. (5.33% p.a. comparison rate*).
• Basic Fixed 5 Years LVR ≤80%: 90 basis point decrease to 5.39% p.a. (5.35% p.a. comparison rate*).
• Basic Fixed 3 Years LVR ≤90%: 46 basis point decrease to 5.59% p.a. (5.42% p.a. comparison rate*).
• Basic Fixed 5 Years LVR ≤90%: 101 basis point decrease to 5.59% p.a. (5.47% p.a. comparison rate*). 

For investors, key decreases include: 

• Investment Basic IO Fixed 3 Years LVR ≤70%: 41 basis point decrease to 5.59% p.a. (5.49% p.a. comparison rate*).
• Investment Basic IO Fixed 5 Years LVR ≤70%: 100 basis point decrease to 5.59% p.a. (5.51% p.a. comparison rate*). 
• Investment Basic P&I Fixed 3 Years LVR ≤80%: 41 basis point decrease to 5.39% p.a. (5.44% p.a. comparison rate*).
• Investment Basic P&I Fixed 5 Years LVR ≤80%: 100 basis point decrease to 5.39% p.a. (5.44% p.a. comparison rate*).

Australian Mutual Bank cuts fixed home loan rates by up to 0.55% p.a. 

Australian Mutual Bank has decreased fixed home loan rates in the past week by up to 55 basis points. 

Key decreases for both owner occupiers and investors include: 

• Residential Fixed 3 Years LVR 80%: 35 basis point decrease to 5.58% p.a. (5.80% p.a. comparison rate*). 
• Residential Fixed 5 Years LVR 80%: 55 basis point decrease to 6.03% p.a. (5.97% p.a. comparison rate*).
• Investment Fixed P&I 3 Years LVR 80%: 35 basis point decrease to 5.78% p.a. (6.22% p.a. comparison rate*).
• Investment Fixed P&I 5 Years LVR 80%: 55 basis point decrease to 6.23% p.a. (6.34% p.a. comparison rate*).  

Athena cuts fixed home loan rates by up to 0.70% p.a. 

Digital lender Athena cut fixed home loan rates over the past week by up to 70 basis points. 

The most notable changes across Athena’s fixed rate portfolio were observed across investor fixed rate loans, including: 

• Investor Fixed P&I 3 Years LVR 70-80%: 55 basis point decrease to 5.69% p.a. (5.69% p.a. comparison rate*).
• Investor Fixed IO 3 Years LVR 70-80%: 70 basis point decrease to 5.69% p.a. (5.71% p.a. comparison rate*).

New fixed-rate with no break costs

With competition heating up in the fixed rate home loan space led by major banks making moves, non-bank lender Pepper Money has launched a two-year fixed rate home loan with the added benefit of no break costs.

The new two-year fixed rate home loan for customers with a LVR of up to 55% bears an interest rate of 5.59% p.a. (5.77% p.a. comparison rate*) and is available for those submitting an application before 12 May 2023 with formal approval by 19 May 2023. 

The low-LVR product is ostensibly designed for those looking to refinance, whose mortgages and homes have considerable equity.

With no break costs, the new product from Pepper Money aims to provide customers with the flexibility to make extra repayments or switch to a variable interest rate option at any time without incurring significant fees.

A break fee is a calculation considering the lender's wholesale costs, the rate at when you fixed versus the new product, and how long you have left on your fixed period - as such, it can often cost thousands or tens of thousands of dollars.

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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.

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Lender	Home Loan	Interest Rate	Comparison Rate*	Monthly Repayment	Repayment type	Rate Type	Offset	Redraw	Ongoing Fees	Upfront Fees	Max LVR	Lump Sum Repayment	Extra Repayments	Split Loan Option	Tags	Features	Link	Compare	Promoted Product	Disclosure
loans.com.au	loans.com.au Bare Home Loan (Basic OO P&I <90%)	5.94% p.a.	5.98% p.a.	$2,978	Principal & Interest	Variable			$0	$530	90%				Owner Occupier Variable Principal & Interest 10% Min Deposit Redraw Extra Repayments More details	Available for purchase or refinance, min 10% deposit needed to qualify. No application, ongoing monthly or annual fees. Dedicated loan specialist throughout the loan application.	Go to site	Compare	Promoted	Disclosure
Unloan	Unloan Variable Rate Home Loan LVR < 80%	5.89% p.a.	5.80% p.a.	$2,962	Principal & Interest	Variable			$0	$0	80%				Built and funded by CommBank Owner Occupier Variable Principal & Interest 20% Min Deposit Redraw More details	No application or ongoing fees. Annual rate discount Unlimited redraws & additional repayments. LVR <80% A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.	Go to site	Compare	Promoted	Disclosure
Regional Australia Bank	Regional Australia Bank Home Loan Fixed (Owner Occupier, Principal and Interest, max lvr 60%) (3 years)	5.99% p.a.	6.02% p.a.	$2,995	Principal & Interest	Fixed			$0	$0	60%				Owner Occupier Fixed 3 Years Principal & Interest 40% Min Deposit Redraw More details	Competitive rates to help you save A Dedicated Relationship Manager Certainty of repayments with a fixed rate term	Go to site	Compare	Promoted	Disclosure
Homestar	Homestar Star Nova LVR <70% (Owner Occupied, Principal and Interest)	5.93% p.a.	5.93% p.a.	$2,975	Principal & Interest	Variable			$0	$395	70%				Owner Occupier Variable Principal & Interest 30% Min Deposit Redraw More details		Go to site	Compare		Disclosure
Reduce Home Loans	Reduce Home Loans EconoME Home Loan (Owner Occupier, Principal & Interest, LVR 60%)	5.99% p.a.	6.01% p.a.	$2,995	Principal & Interest	Variable			$0	$150	60%				$3000 Cashback T&Cs apply Owner Occupier Variable Principal & Interest 40% Min Deposit Redraw More details		Go to site	Compare		Disclosure

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