BOQ sets new mortgage benchmark – 4.89% p.a. for 2-year fixed home loan

Bank of Queensland (BOQ) if offering a standout two-year fixed home loan rate of 4.89% p.a. (5.62% comparison rate*) for owner-occupiers – the lowest 2-year fixed rate in Mozo’s database. 

More than just a headline grabber, this bold move may encourage even more competition across lenders and provide borrowers both stability and future flexibility.

“By offering a new market-leading rate, we’re helping customers manage their budgets with confidence,” BOQ Group Head of Home Buying Shirphine Loh said.

“This gives borrowers a chance to lock in certainty now while staying flexible for what’s ahead."

What’s behind the rate shift

Setting the pace: BOQ’s aggressive pricing follows recent fixed-rate cuts from other lenders ahead of next week’s Reserve Bank decision. With economists and markets widely expecting a 25 basis point cut to the cash rate – after holding steady at 3.85% in July – banks are under pressure to pass on savings to borrowers.

A strategic mix: BOQ is actively promoting split-loan structures, combining a fixed portion for repayment certainty with a variable chunk to benefit if rates drop. For customers, this may deliver best-of-both-worlds flexibility during the current rate cutting cycle.

“A split loan structure is particularly powerful in this environment. It allows customers to fix part of their loan for repayment stability, while keeping the other portion variable to benefit from any future rate reductions," Loh said.

“It’s about giving control and choice at a time when household budgets are under pressure.”

Why this matters for borrowers

1. Lower rates before RBA’s move – Many lenders are front-running a potential cash rate cut.
2. Budgeting – Lock in a sub-5% rate for relief now, with potential for variable savings later.
3. Split-loan options – Get a safety net today with upside potential if rates fall tomorrow.

After the last cash rate cut in May 2025, a Mozo analysis revealed some lenders are much quicker than others to pass on the savings. While smaller lenders like Unloan and Athena Home Loans were quick to act, the Big Four banks took significantly longer. This can cost borrowers money, so keeping an eye on your lender's track record and comparing a switch to a more responsive one can ensure you're getting the best deal.

Mozo in action: steps for smarter borrowing

• Compare now: Explore how BOQ’s 4.89% p.a. rate stacks up against other home loans.
• Learn the strategy: Read Mozo’s split-loan guide to understand if it's right for you.
• Forecast your refinance: Use our refinance calculator to break down the costs of switching.

Compare more fixed rate home loans below