Aussies looking to refinance now are being thrown a line by banks, with cuts to fixed rates presented as an option to offer security from RBA cash rate and variable rate increases.
The preference for variable rate home loans however remains strong according to the latest ABS lending data with variable loan commitments sitting at more than $52 billion in June compared to $5 billion for fixed loans.
Unloan CEO Daniel Oertli said by cutting fixed rates, lenders are looking to capture market share for the duration of the next few years.
"Fixed rates allow most lenders to predict they're going to hold that customer for the duration of the fixed rate, given the expensive break fees associated with refinancing during that period," Mr Oertli told Savings.com.au.
"Fixed rates now are generally much higher than variable rates, so you have to make that trade off as a customer as to whether you're prepared to pay a much higher rate now for a fixed term fixed or knowing that variable rates are going up, still take advantage of the savings on offer by choosing variable."
See Also: Home Loan Statistics
ING cuts fixed and variable rates by up to 0.50% p.a.
ING has cut fixed and variable rates for owner occupiers and investors across principal and interest (P&I) and interest-only (IO) loan options.
Highlights across ING's portfolio for owner occupiers include:
- Residential Fixed 4 Years ≤80%: 50 basis point decrease to 5.09% p.a. (4.19% p.a. comparison rate*)
- Orange Advantage Residential Fixed 4 Years ≤ 80%: 50 basis point decrease to 4.99% p.a. (4.45% p.a. comparison rate*)
- Orange Advantage Variable P&I 150-499k 80%: 10 basis point decrease to 3.74% p.a. (4.06% p.a. comparison rate*)
- Orange Advantage Variable IO 150-499k: 10 basis point decrease to 4.39% p.a. (4.70% p.a. comparison rate*)
For investors, changes include:
- Investment Fixed P&I 4 Years: 50 basis point decrease to 5.19% p.a. (4.69% p.a. comparison rate*)
- Investment Fixed IO 4 Years: 50 basis point decrease to 5.39% p.a. (4.74% p.a. comparison rate*)
- Investment Orange Advantage Variable P&I 150-499k: 10 basis point decrease to 3.99% p.a. (4.31% p.a. comparison rate*)
- Investment Orange Advantage Variable IO 150-499k: 10 basis point decrease to 4.29% p.a. (4.60% p.a. comparison rate*)
Bank of us decreases variable rate by up to 0.20% p.a.
Tasmanian lender Bank of us cut one variable-rate home loan by 20 basis points.
The FlexiDiscount home loan up to 95% LVR was reduced to 4.19% p.a. (4.25% p.a. comparison rate*)
Otherwise, the bank increased variable home loan rates for owner occupiers and investors.
Highlights of these changes include:
- FlexiDiscount 80%: 50 basis point increase to 3.79% p.a. (3.81% p.a. comparison rate*)
- Topline 80%: 50 basis point increase to 3.99% p.a. (4.01% p.a. comparison rate*)
- Investment FlexiChoice ≤80%: 40 basis point increase to 3.99% p.a. (4.15% p.a. comparison rate*)
Bankwest cuts fixed and variable rates by up to 0.70% p.a.
Bankwest has cut both fixed and variable rates for owner occupiers and investors solely across P&I loans.
Highlights of these changes across Bankwest's home loan portfolio include:
- Premium Select Home Loan OO P&I 80%: 10 basis point decrease to 3.79% p.a. (3.81% p.a. comparison rate*)
- Premium Select Home Loan Investment P&I 80% $20k+: 10 basis point decrease to 4.19% p.a. (4.21% p.a. comparison rate*)
- Complete Home Loan Fixed Rate Owner Occupied P&I 2 yrs ≤80%: 70 basis point decrease to 4.99% p.a. (5.20% p.a. comparison rate*)
Suncorp cuts fixed rates by up to 0.76% p.a.
Suncorp has cut fixed rates for owner occupiers and investors across both P&I and IO loan options.
Key changes across Suncorp's fixed rate portfolio include:
- Fixed P&I 2 Years 95%: 50 basis point decrease to 5.84% p.a. (6.73% p.a. comparison rate*)
- Fixed IO 2 Years 90%: 16 basis point decrease to 6.43% p.a. (6.82% p.a. comparison rate*)
- Home Package Plus P&I Fixed 2 Years ≤80% Special Offer: 50 basis point decrease to 5.39% p.a. (4.57% p.a. comparison rate*)
- Investment Fixed P&I 2 Years 90%: 56 basis point decrease to 6.04% p.a. (7.12% p.a. comparison rate*)
- Investment Fixed IO 2 Years 90%: 76 basis point decrease to 6.24% p.a. (7.16% p.a. comparison rate*)
- Investment Home Package Plus P&I Fixed 2 Years ≤80% Special Offer: 56 basis point decrease to 5.59% p.a. (4.83% p.a. comparison rate*)
Bank of Queensland cuts fixed rates by up to 1.30% p.a.
Bank of Queensland (BOQ) has cut fixed rates for owner occupiers and investors across P&I loans.
Highlights of these changes across BOQ's home loan portfolio include:
- Residential Fixed 4 Years 98%: 110 basis point decrease to 5.34% p.a. (5.15% p.a. comparison rate*)
- Residential Fixed 4 Years Discount Rate <80%: 100 basis point decrease to 4.99% p.a. (5.01% p.a. comparison rate*)
- Investment Fixed P&I 4 Years: 130 basis point decrease to 5.64% p.a. (5.37% p.a. comparison rate*)
- Investment Fixed P&I 4 Years Discount Rate <80%: 85 basis point decrease to 5.29% p.a. (5.26% p.a. comparison rate*)
AMP increases fixed rates by up to 0.65% p.a.
Taking the opposite route, AMP has increased fixed home loan rates for owner occupiers and investors across both P&I and IO loans.
Key changes include:
- Basic Fixed P&I 1 Year: 65 basis point increase to 5.34% p.a. (4.76% p.a. comparison rate*)
- Basic Fixed IO 1 Year: 65 basis point increase to 5.74% p.a. (4.52% p.a. comparison rate*)
- Investment Basic Fixed P&I 1 Year: 65 basis point increase to 5.39% p.a. (5.11% p.a. comparison rate*)
- Investment Basic Fixed IO 1 Year: 55 basis point increase to 5.39% p.a. (4.67% p.a. comparison rate*)
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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.
| 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 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.94% p.a. | 5.98% p.a. | $2,978 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
5.89% p.a. | 5.80% p.a. | $2,962 | Principal & Interest | Variable | $0 | $0 | 80% |
| Promoted | Disclosure | ||||||||||
5.99% p.a. | 6.02% p.a. | $2,995 | Principal & Interest | Fixed | $0 | $0 | 60% |
| Promoted | Disclosure | ||||||||||
5.93% p.a. | 5.93% p.a. | $2,975 | Principal & Interest | Variable | $0 | $395 | 70% | Disclosure |
