NAB has cut interest rates on investment interest-only loans, a market that has seen a lot of activity in recent weeks.

Curiously, NAB made cuts by up to 60 basis points on its 'In Arrears' products, which despite what the name might suggest, aren't for people falling behind on their mortgages.

Interest-only home loans can be paid one of two ways - in arrears, or in advance.

'In arrears' means paying the interest off at the end of each month, while 'in advance' payments are made once a year.

Paying in advance could help bring forward tax-deductible interest payments.

The 'In Arrears' home loans to see cuts by 60 basis points were:

  • Inv Tailored FIxed IO in arrears 1 year: Now 2.89% p.a. (5.13% p.a. comparison rate*)
  • Inv Tailored FIxed IO in arrears 2 years: Now 2.79% p.a. (4.91% p.a. comparison rate*)
  • Inv Tailored FIxed IO in arrears 3 years: Now 2.79% p.a. (4.70% p.a. comparison rate*)

NAB also cut interest rates on the same product line fixed for four and five years by 20 basis points.

Meanwhile, ANZ raised rates by 10 basis points on two key residential home loan products, both fixed for two years. They are:

  • Breakfree Residential Fixed 2 Years 150k+: Now 2.29% p.a. (4.02% p.a. comparison rate*)
  • Residential Fixed 2 Years: Now 2.44% p.a. (4.10% p.a. comparison rate*)

This slight hike on home loans recently is not unique - ME Bank raised rates by up to 30 basis points at the start of May, a day before its redraw controversy broke.

Both ANZ and NAB were contacted for comment but did not respond in time for deadline.

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.

Rates
Features
Fees
Other
Lender
VariableMore details
4.6 Star Customer RatingsIncludes Nov RBA Rate Increase
4.6 Star Customer RatingsIncludes Nov RBA Rate Increase

loans.com.au – Variable Home Loan (LVR < 90%)

    More details
    VariableMore details
    Unlimited Redraws
    • No annual fees – None!
    • Get fast pre-approval
    • Unlimited additional repayments free of charge
    • Redraw freely – Access your additional payments when you need them
    • Home loan specialists available today
    Unlimited Redraws

    ubank – Neat Variable Home Loan (Principal and Interest) (LVR < 60%)

    • No annual fees – None!
    • Get fast pre-approval
    • Unlimited additional repayments free of charge
    • Redraw freely – Access your additional payments when you need them
    • Home loan specialists available today
    More details
    VariableMore details

    ANZ – Standard Variable Home Loan (Principal and Interest) (LVR < 80%)

      More details
      • Immediate cashback upon settlement
      • $2000 for loans up to $700,000
      • $4000 for loans over $700,000

      More details
      Important Information and Comparison Rate Warning

      Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of December 12, 2023. View disclaimer.

      Reduce, Tic:Toc also cut rates

      Challenger brands Reduce Home Loans and Tic:Toc also made a number of home loan rate cuts in the past week.

      Some key cuts were:

      Reduce

      Reduce cut rates on quite a large number of residential loans, including the headline product:

      • Low Rider Variable 70% LVR: 15 basis point cut to 2.29% p.a. (2.32% p.a. comparison rate*)

      A number of other loans in the same product category with 80% LVR, and also ones paying interest-only, were cut by up to 45 basis points.

      Tic:Toc

      Tic:Toc in the past week made just one key cut, which was a 15 basis point cut to the Live In Variable home loan paying principal and interest, down to 2.39% p.a. (2.40% p.a. comparison rate*).



      Ready, Set, Buy!


      Learn everything you need to know about buying property – from choosing the right property and home loan, to the purchasing process, tips to save money and more!

      With bonus Q&A sheet and Crossword!

      By subscribing you agree to our privacy policy