The regional bank's new lowest rate of 5.25% p.a. (5.62% p.a. comparison rate*) is open to owner-occupiers with less than 60% loan-to-value ratio (LVR), making principal and interest (P&I) repayments, and fixing for two years.
It's the lowest fixed home loan rate available on the market outside of green home loan products where finance is subsidised via the federal government's Clean Energy Finance Corporation.
Regional Australia Bank, headquartered in Armidale, New South Wales, has knocked 36 basis points off its old rate to hit the new low.
Borrowers with 60-70% LVR can also lock in for two years at 5.25% p.a. (5.66% p.a. comparison rate*).
Here are Regional Australia Bank's new fixed rates for owner-occupiers, making P&I repayments:
| LVR | Fixed period | % change | New rate | Comparison rate* |
| <60% | 1 year | -0.32 | 5.40% p.a. | 5.67% p.a. |
| 2 years | -0.36 | 5.25% p.a. | 5.62% p.a. | |
| 3 years | -0.30 | 5.30% p.a. | 5.59% p.a. | |
| 4 years | -0.22 | 5.52% p.a. | 5.64% p.a. | |
| 5 years | -0.14 | 5.74% p.a. | 5.72% p.a. | |
| 60-70% | 1 year | -0.32 | 5.40% p.a. | 5.73% p.a. |
| 2 years | -0.36 | 5.25% p.a. | 5.66% p.a. | |
| 3 years | -0.30 | 5.30% p.a. | 5.63% p.a. | |
| 4 years | -0.22 | 5.52% p.a. | 5.68% p.a. | |
| 5 years | -0.14 | 5.74% p.a. | 5.72% p.a. | |
| 70-80% | 1 year | -0.27 | 5.50% p.a. | 5.79% p.a. |
| 2 years | -0.31 | 5.35% p.a. | 5.73% p.a. | |
| 3 years | -0.26 | 5.39% p.a. | 5.70% p.a. | |
| 4 years | -0.18 | 5.61% p.a. | 5.75% p.a. | |
| 5 years | -0.10 | 5.83% p.a. | 5.83% p.a. | |
| 80-90% | 1 year | -0.40 | 5.68% p.a. | 6.09% p.a. |
| 2 years | -0.24 | 5.52% p.a. | 6.02% p.a. | |
| 3 years | -0.39 | 5.57% p.a. | 5.98% p.a. | |
| 4 years | -0.31 | 5.79% p.a. | 6.02% p.a. | |
| 5 years | -0.24 | 6.01% p.a. | 6.09% p.a. | |
| >90% | 1 year | -0.34 | 6.16% p.a. | 6.52% p.a. |
| 2 years | -0.39 | 6.00% p.a. | 6.45% p.a. | |
| 3 years | -0.33 | 6.05% p.a. | 6.42% p.a. | |
| 4 years | -0.26 | 6.27% p.a. | 6.46% p.a. | |
| 5 years | -0.18 | 6.49% p.a. | 6.53% p.a. |
Investor fixed rates also cut
Investor rates were also dropped across the board with Regional Australia Bank's new lowest investor rate 5.46% p.a. (5.75% p.a. comparison rate*).
It applies to investors with LVRs below 60%, making P&I repayments, and fixing their loans for two years.
Investor rates jump by 25 basis points for those making interest-only (IO) repayments.
See also: Compare interest-only home loan rates
Are borrowers taking up fixed rates?
Fixed home loan rates have been on the downhill since mid-last year in preparation for long-anticipated cuts to the Reserve Bank of Australia cash rate.
The RBA board delivered its first cash rate cut in more than four years in February and markets are gearing up for another cut to the cash rate in May.
In an environment where rates are forecast to fall, it's understandable borrowers are hesitant to lock themselves into a fixed home loan rate for an extended period as variable rates head lower.
See also: How to choose between a fixed-rate and a variable-rate home loan
Lending data from the Australian Bureau of Statistics (ABS) shows new borrowers continue to shun fixed home loans, which account for around 2% of overall new home lending by value.
Will interest rates head lower?
The RBA's new Monetary Policy Board is set to meet next on 19-20 May to determine Australia's cash rate setting.
Economists at Australia's largest home lender, Commonwealth Bank of Australia, have made the big call that a rate cut is a "done deal" - if inflation drops in line with its expectations.
The ABS's quarterly inflation data is due to be released on Wednesday 30 April and is widely tipped to show Australia's underlying inflation rate is within the RBA's target band of 2-3%.
CBA analysts believe there will be a 25-basis point cut to the cash rate next month with two more to come in August and November, bringing the cash rate to 3.35% by the end of the year.
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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. | 5.95% p.a. | $2,995 | Principal & Interest | Fixed | $0 | $0 | 60% |
| ||||||||||||
6.23% p.a. | 6.23% p.a. | $3,072 | Principal & Interest | Variable | $0 | $395 | 70% | Disclosure |
