Photo by Tim Whybroe on Unsplash
This is the first time a lender has breached the 1% barrier after many other lenders edged close with rates in the low 2% range.
The sub-2.00% advertised rate from the Bank of Us is a 'special' offer for new owner-occupier customers on loans of up to 90% of the property value, but is said to be a limited time offer.
The special 1.99% p.a. offer represents a 60 basis point cut over Bank of Us' regular 'FlexiDiscount' rate.
The special fixed rate will be offered across 1-year, 2-year and 3-year fixed terms:
- FlexiDiscount Special Fixed 1 Year: 1.99% p.a. (2.88% p.a. comparison rate*)
- FlexiDiscount Special Fixed 2 Years: 1.99% p.a. (2.81% p.a. comparison rate*)
- FlexiDiscount Special Fixed 3 Years: 1.99% p.a. (2.73% p.a. comparison rate*)
Source: Bank of Us. Rates based on LVR >80% ≤90%
Bank of Us features the same advertised rates for borrowers with LVRs less than or equal to 80%, but the comparison rates are lower.
The advertised rate doesn't take into account some of the fees applicable (many home loans have various fees attached, hence the higher comparison rate).
There is a $350 loan establishment fee, however there are no ongoing monthly or yearly fees.
After the fixed period ends, the advertised interest rate reverts to a higher variable rate, which is 2.93% p.a. at the time of writing.
This revert rate is lower than what we've seen in the market, with many lenders' standard variable rates still in the 3-4% range.
More broadly, many lenders have focused on cutting interest rates for fixed loans recently as more owner-occupiers opt to lock in their home loan interest rates.
CommBank recently revealed owner-occupiers made up nearly half of all of its fixed rate lending in May.
Bank of Us is a customer-owned bank based in Tasmania, and began as the Launceston Equitable Building and Investment Society in 1870.
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 | 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 |
