The Big Four Banks, ING, ANZ, NAB, Westpac and CommBank are all cutting fixed rates to the low-2% p.a. range , reaching record breaking low rates.
However, over the course of the past few weeks, the small lenders such as Freedom Lend, Unibank, and Ubank, have taken the spot light, making drastic home loan rate cuts.
Once again, fixed home loans got most of the cuts as lenders take this opportunity to consolidate their customer base during the COVID-19 crisis.
Interest-only (IO) products received the brunt of the cuts, as opposed to principal and interest (P&I) – the considerations to make when switching to IO can be found here.
The new fixed rate offers on the market compare favourably with some of the lowest variable rates available.
Freedom Lend
Freedom Lend cut its ‘Freedom Fixed P&I’ loan, fixed for two years at 80% LVR by 25 basis points.
That brings its advertised rate down to 2.09% p.a. (2.68% p.a. comparison rate*).
This is advertised as a ‘Special Offer’, meaning the special rate can be withdrawn at any time.
Unibank
Unibank made a 52 basis point cut to its two and three year fixed home loans for owner occupiers down to an advertised rate of 2.14% p.a.
The comparison rate* for the two-year loan is 4.01% p.a., and for three years its 3.83% p.a.
Investors also got some love, with Unibank also cutting by 52 basis points on two and three year fixed loans down to 2.29% p.a. (4.04% p.a. for two years, 3.87% p.a. for three years comparison rates*)
Beyond Bank
Beyond Bank cut its ‘Total Home Loan Package’ fixed ‘rate for three years by 50 basis points, down to 2.29% p.a. (3.81% p.a. comparison rate*)
This is also a ‘special offer’, and can be withdrawn at any time.
IMB
IMB made cuts to its owner occupier loans paying P&I for two and three years up to a maximum LVR of 90%:
- The one year fixed rate saw a 45 basis point cut down to 2.29% p.a. (3.19% p.a. comparison rate*)
- The two years’ fixed rate saw a 40 basis point cut also down to 2.29% p.a. (3.12% p.a. comparison rate*)
Queensland Country Bank
As a special offer, Queensland Country Bank cut its two-year package home loan by 20 basis points down to 2.29% p.a. (3.84% p.a. comparison rate*).
UBank
UBank made quite a few cuts to its fixed home loans, with the lowest advertised rates attached to its one and three year fixed home loans, paying P&I.
The cuts were:
- UHomeLoan Fixed P&I 1 Year: 45 basis point cut to 2.29% p.a. (3.12% p.a. comparison rate*)
- UHomeLoanFixed P&I 3 Years: 40 basis point cut to 2.29% p.a. (2.90% p.a. comparison rate*)
These home loans have a 20% minimum deposit requirement.
Greater Bank
Greater Bank made a raft of cuts to its fixed products.
Most noteworthy was a 40 basis point cut to the ‘Great Rate’ product, fixed for one year at a special rate of 2.39% p.a. (3.56% p.a. comparison rate*).
The ‘Ultimate’ home loan fixed for one year also saw a 40 basis point cut to 2.39% p.a. (3.78% p.a. comparison rate*).
The main difference between the ‘Ultimate’ and ‘Great Rate’ products is that the Ultimate products come with an offset account.
These home loans are for a maximum LVR of 90%, paying P&I – interest-only loans attract a 10 basis point premium over their P&I counterparts.
Disclaimers
For the purposes of brevity, the entire market was not considered in selecting the above products. Rather, a cut-down portion of the market was considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:
Some providers’ products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider’s web site.