Borrowers dump banks as rivals slash rates

Mozo

10 Jul 2021

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As the property market sizzles and rival lenders slash rates in some of the fiercest mortgage competition we’ve seen in years, borrowers are flocking to comparison sites to hunt out bargain home loan deals.

Interest in cheaper home loans is soaring, putting the big banks under pressure to keep their customers. Competition is particularly fierce on fixed rates, headlined by UBank’s 3-year rate of 1.85% (2.24% comparison rate*) for owner occupier borrowers. Bank of Queensland also has a super competitive 2-year rate below 1.90%, complete with bonus $3,000 cashback for refinancers.

Meanwhile rival lenders like HSBC, loans.com.au and Athena are rolling out unbelievably low variable rates for refinancers and borrowers with big deposits.

Mozo Money Expert Tom Godfrey said, “Savvy borrowers could save tens of thousands on their home loan by taking the opportunity to shop around and switch.  Given the savings on offer, it's hardly surprising we're seeing a shift to challenger lenders away from the big four banks.”

Top Fixed Rate Home Loans

UBank UHomeLoan
UBank
  • 1.85% fixed rate for 3 years (2.24% comparison rate*)

  • Free extra repayments up to $20,000 p.a.

  • Mozo Experts Choice Best Fixed Rate Home Loan 2021

The details:

UBank is the online bank created by NAB to shake things up in the borrowing and savings world, and boy have they succeeded! Bringing to the table super competitive interest rates, zero upfront or ongoing fees and speedy online processes, it’s little wonder UBank has become such a success story. This ultra low 3-year fixed rate home loan is available for loans of $200,000 or more with a minimum deposit of 20%.

Bank of Queensland Discount Fixed Rate
Bank of Queensland
  • 1.89% fixed rate for 2 years (3.05% comparison rate*)

  • $3,000 cashback for refinancers - Apply by 29 August

  • Free extra repayments up to $5,000 p.a.

The details:

Bank of Queensland is making waves with this super low 2 year fixed rate home loan, which lets you guarantee your monthly repayments while still taking advantage of flexible features like the ability to make free extra repayments up to $5,000 a year and split your loan between fixed and variable. On top of that, refinancers who apply by 29 August will also score a bonus $3000 cashback. Available to borrowers with a 20% deposit or more.

86 400 Own Home Loan
86 400
  • 1.84% fixed rate for 1 year (2.63% comparison rate*)

  • Free extra repayments up to $20,000 per year

  • Available to borrowers with 40% deposit or equity

The details:

86 400 has just dropped this cracking fixed home loan offering borrowers with 40% deposit or equity the chance to lock in 1.84% for 1 year (2.63% compaison rate*). You’ll have the ability to make free extra repayments up to $20,000 a year and have the option to set up multiple offset accounts to help bring your interest down and pay off your loan faster. A free redraw facility is is the icing on the cake.

Top Variable Home Loans

HSBC Home Value Loan
HSBC
  • New 2.19% variable rate (2.20% comparison rate*) for borrowers with 70% LVR

  • Enjoy free extra repayments, online redraw and no ongoing fees

  • $3,288 cashback for refinancers - Apply by 31 July

The details:

HBSC is the first major bank in the Mozo comparison database to introduce a variable home loan rate this low for borrowers with 30% deposit or equity. The loan comes with all of the features you'd expect from a bank, including free extra repayments, a free online redraw facility, an optional split account and a dedicated relationship manager to guide you through the application process. And if you're refinancing $250,000 or more to HSBC, you can enjoy a generous $3,288 cashback.

Athena Celebrate Variable Home Loan
Athena
  • 1.99% variable rate and comparison rate*

  • No application, valuation or ongoing fees

  • Minimum 40% deposit required

The details:

The Celebrate Variable Home Loan from Athena features an incredibly low rate for refinancers and a customer first approach, helping Aussies around the country save money and pay off their mortgages sooner. Plus, to reward borrowers for paying down their home loan, Athena will now automatically lower your rate as you pay down your loan. Available to borrowers with a 40% deposit or equity in their property, this  Athena Home Loan is shaking up the mortgage market.

loans.com.au Smart Booster Home Loan
loans.com.au
  • 1.85% discounted variable rate for 2 years

  • Rolls over to low ongoing 2.25% (2.21% comparison rate*)


  • Optional offset account for 0.10%

The details:

Looking for a loan that's easy on your wallet? Look no further than the Smart Booster Home Loan from popular online lender loans.com.au. This low rate, low fee mortgage is packed with handy features like free extra repayments, unlimited free redraw, an optional offset account and a split rate option. With all this value on offer and no pesky ongoing fees to boot, it's no surprise the Smart Booster took out a Mozo Experts Choice Low Cost Home Loan Award for 2021. Minimum 30% deposit.

*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 the amount and term you entered.

**Initial monthly repayment figures are estimates only, based on the advertised rate, and a loan of $500,000 repaid over 25 years. 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.

^See information about the Mozo Experts Choice Home loans Awards

Looking for more options? Head over to our home loan comparison table to compare 500+ home loans from more than 80 lenders.

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