RBA cut sparks race to bottom for rival lenders
In a rates dream for home borrowers, Australia's challenger lenders are competing to roll out ultra-low variable and fixed home loan rates from under 2.00%, offering potential savings of tens of thousands of dollars for borrowers who are prepared to compare and switch.
Since the RBA cut the cash rate to a historical low of 0.10%, popular online lenders such as UBank, loans.com.au, Athena and Homestar have raced out of the blocks with new rock bottom fixed and variable home loan rates. Meanwhile, challenger lenders like Suncorp, BOQ and CUA are reducing their already competitive fixed home loans.
So if you’ve been holding out for the right home loan, here are some of the top loans currently on the market to get your search off to a smashing start.
NEW ROCK BOTTOM RATES - NOVEMBER 2020
loans.com.au - Smart Booster Home Loan
- 1.99% intro variable rate for 1 year (2.47% comparison rate*)
- Offset account option available
- No application or service fees
The details:
Popular online lender loans.com.au offers up an ultra-low one year intro rate and competitive ongoing variable rate of 2.48% to help you pay off your home loan faster and save on interest while you're at it. You can also take advantage of flexible features like an optional offset account and free redraw facility, plus enjoy zero application or ongoing service fees. With the Smart Booster Discount Variable Loan you’ll be able to borrow up to $1 million over a 15-30 year term with 20% deposit.
Homestar - Star Essentials Home Loan
- New 2.14% p.a. variable rate (2.17% p.a. comparison rate*)
- Free extra repayments and redraw facility
- No monthly or ongoing account fees
The details:
Once again, Homestar has shown its customer first commitment and passed on the latest RBA cut to variable borrowers effective immediately. The Star Essentials Home Loan has one of the lowest variable rates in town plus a number of handy features - including unrestricted extra repayments and free online redraws - to give owner occupiers plenty to get excited about. Plus, refinancers receive up to $1,500 cashback or upfront fees waived on purchases for applications received by 30 November, 2020.
UBank - UHomeLoan
- New 1.95% fixed rate for 3 years (2.36% comparison rate*)
- Free extra repayments up to $20,000 p.a.
- Fast and easy online application
The details:
With a fast and simple application process, the security of a super low rate locked in for 3 years and the flexibility to make free additional repayments up to $20,000 a year, this little gem could be a great choice for borrowers who want the peace of mind of fixed repayments plus the freedom to pay the loan off faster. UBank is backed by NAB and has home loan experts on tap to help you through the online application process.
Athena - Celebrate Variable Home Loan
- New 2.19% variable rate (2.19% comparison rate*)
- Zero Athena fees plus free extra repayments and redraw
- Minimum 40% deposit or equity
The details:
Online lender Athena has yet again cut rates in line with the RBA and the Athena Variable Home Loan is one of the best value home loans on offer for borrowers with decent equity and an LVR of 60% or less. In addition to a jaw dropping new rate, you'll also enjoy zero upfront or ongoing fees. Plus, to reward borrowers for paying down their home loan, Athena will now automatically lower your rate as you pay off your loan. Available to refinancers and purchasers buying an established property in a major capital or regional city.
Suncorp - Fixed Home Loan Special Offer
- 1.89% fixed rate for 2 years (2.94% comparison rate*)
- No upfront fees
- $2,000 cash bonus for refinancers (T&Cs apply)
The details:
Suncorp has just dropped this ultra low 2 year fixed rate home loan for borrowers looking to lock in while rates are at record lows and secure peace of mind over their mortgage repayments. You can make up to $500 a month in extra repayments over the fixed term without penalty, but bear in mind that there is no redraw facility. As an added incentive, for a limited time refinancers can get a cash bonus of $2,000 when refinancing an eligible home loan.
Bank of Queensland - Discount Fixed Rate
- 2.09% fixed rate for 3 years (3.01% comparison rate*)
- Free extra repayments up to $5,000 each year
- $3,000 cashback for refinancers (T&Cs apply)
The details:
This newly discounted fixed rate offer from Bank of Queensland lets you lock in a competitive rate for 3 years and earn $2,000 cashback when you refinance a home loan of $250K or more. You'll enjoy the certainty of fixed repayments while still having the flexibility to make extra repayments of up to $5,000 a year without penalty to help pay off your home loan faster. Minimum LVR 80%.
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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.
** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.
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