It’s been a busy week on the home loan market with eleven lenders tweaking both variable and fixed rates, the vast majority heading lower.
The previous week, Australia’s fifth largest home lender Macquarie Bank sent a signal to the big four it was out to shore up more than its 5.3% share of the retail mortgage market.
Macquarie trimmed rates on its Basic Variable and Offset Variable loans, taking its lowest rate to 6.14% p.a. (6.16% p.a. comparison rate*) for its Basic owner-occupier principal and interest (P&I) mortgages for loan-to-value ratios between ≤60-70%.
Unlike the big four, Macquarie takes a what-you-see-is-what-you-get approach to its home lending rates.
It made NAB’s dramatic 78 basis point drop mid-April to 6.79% p.a. (6.87% p.a. comparison rate*) for its Tailored Variable owner-occupier home loans seem a little staged.
The big four banks routinely discount their advertised rates with the new number bringing the rate a little closer to what its borrowers are actually paying.
Let’s check which lenders were called to action this week.
RACQ Bank is under 6%
Queensland’s RACQ Bank has shaved five basis points of its Fair Dinkum home loan for LVR ≤60% to 5.99% p.a. (5.99% p.a. comparison rate*).
It’s also dropped rates on its Mortgage Breaker Special Offer owner occupier P&I loans, some by up to 30 basis points.
The new rate for a new >60 to ≤70% LVR loan is now 6.29% p.a. (6.36% p.a. comparison rate*).
There’s also a new deal going for higher LVR loans of >80% to ≤95% of 6.74% p.a. (6.81% p.a. comparison rate*) – although that doesn’t count lenders mortgage insurance.
Other variable rate movers
The former Qantas staff credit union Qudos Bank dropped rates on its Low Cost and No Frills investment loans by up to 20 basis points.
Meantime, Adelaide Bank defied the downward trend on variable rates by adding another 15 basis points to a range of its Smartfit and SmartSaver P&I loans.
Greater Bank also tweaked rates on a range of its owner occupier and investment variable loans, hiking them by up to six basis points.
Fixed rates continue downward march
The plunge in fixed rate loans continues despite borrower interest in them dwindling to a trickle.
Bank of China has made the most dramatic slice to its fixed rates this week, slashing up to 100 basis points off its Fixed Rate P&I owner occupier loans for one to five years.
The new rates are 5.79% p.a. for terms between one and five years, with a comparison rate of 8.28% p.a.* for a one-year fixed term loan and heading down from there.
The Mutual Bank, Easy Street Financial Services, Community First Bank, Unity Bank, and Illawarra Credit Union also joined the party in dropping fixed mortgage rates this week.
There’s always one
Regional Australia Bank mustn’t have got the memo as it increased its fixed rates this week - and some by up to 1.52%.
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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 | LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.04% p.a. | 6.06% p.a. | $2,408 | Principal & Interest | Variable | $0 | $530 | 90% | Featured 4.6 Star Customer Ratings |
| |||||||||
5.99% p.a. | 5.90% p.a. | $2,396 | Principal & Interest | Variable | $0 | $0 | 80% | Featured Apply In Minutes |
| |||||||||
6.09% p.a. | 6.11% p.a. | $2,421 | Principal & Interest | Variable | $0 | $250 | 60% | Featured Unlimited Redraws |
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Image by Zac Gudakov
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