Has Reduce Home Loans just launched the lowest variable rate mortgage in Australia?

By Tom Watson ·
Fact Checked
Advertiser disclosure

Just when you thought rates couldn’t get any lower, online lender Reduce Home Loans looks to have taken variable home loan interest rates to a whole new level with its new Super Saver Variable mortgage.

Launched yesterday, the Super Saver Variable home loan is offering owner occupiers a variable rate of just 2.19% (2.19% comparison rate*). 

Not only does that make it the lowest variable rate currently on offer in the Mozo database by a fair margin, it’s also lightyears ahead of the average^ variable rate in our database which sits at 3.43%. 

To put it in perspective, here are some of the lowest variable home loan rates on offer right now from other lenders.

LenderLoanVariable rate
HomestarStar Essentials2.39% (2.39% comparison rate*)
Tic:TocVariable Home Loan2.39% (2.40% comparison rate*)
Pacific Mortgage GroupStandard Variable2.44% (2.44% comparison rate*)
Well Home LoansWell Balanced2.47% (2.50 % comparison rate*)

While the Super Saver certainly has the new variable rate to beat, there are still a number of fixed home loans with lower rates on offer at present. 

For instance, ING’s Fixed Rate Loan (Orange Advantage) has fixed rates as low as 2.09% (3.77% comparison rate*), as does HSBC’s Fixed Rate Home Loan (Premier) 2-year fixed offer of 2.09% (3.10% comparison rate*).

Super Saver Variable loan details

So what do you need to know about the Super Saver Variable home loan? 

Well as we mentioned above, the loan features a variable interest rate of 2.19% (2.19% comparison rate*) for owner occupiers making principal and interest repayments. 

There’s also a minimum loan amount of $50,000 and a maximum amount of $850,000, plus a maximum loan to value ratio (LVR) of 80%. So if you’re using the loan to buy a property, you’ll need a deposit of at least 20%. 

As you’d expect from a low rate loan, there’s not a heap of features attached, but borrowers will have the option of making free extra repayments and withdrawing them down the track with the redraw facility. 

Okay, so here’s where it gets a bit tricky. A glance at the comparison rate would suggest that the loan doesn’t come with any fees, but that isn’t the case. 

While there’s no ongoing service fee, there are a number of upfront costs including a $440 application fee, $297 legal fee, $250 valuation fee and a $150 settlement fee. 

However, Reduce Home Loans actually offers a loyalty rate discount with the Super Saver variable loan of 0.15% after 60 months, which balances out the fees when it comes to calculating the comparison rate. 

RELATED: New home loan approvals fall but refinancing is on the rise

For even more hot home loan offers from a range of banks and lenders, check out the table below or pay a visit to Mozo’s handy home loan comparison table.

^Average is based on a $400,000 variable rate home loan for an owner occupier making principal and interest repayments with an an LVR of 80%. 

Compare home loans - rates updated daily

Search promoted home loans below or do a full Mozo database search. Advertiser disclosure.
  • placeholder
    Mozo Experts Choice 2021
    Smart Booster Home Loan

    2 Year Discounted Variable Rate, Owner Occupier, Principal & Interest, <80% LVR

    interest rate
    comparison rate
    Initial monthly repayment
    1.85% p.a.variable for 24 months and then 2.25% p.a. variable
    2.21% p.a.

    New super low introductory rate home loan for two years. Min 20% deposit. No monthly or ongoing fees. Fast settlement times. Mozo award-winning online lender. Friendly, local Australian based team.

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  • Hot DealFor a chance to win $100K towards your home loan, apply with Athena before Oct 31 & approved by Dec 15 (Please read the full T&C's)
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    Mozo Experts Choice 2021
    Celebrate Variable Home Loan

    <60% LVR, Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    1.99% p.a. variable
    1.99% p.a.

    Fast and efficient online application. Automatic discounts as loan is paid down. Free extra repayments and redraw facility. Zero fees. Min 40% deposit required. Winner of three Mozo Expert's Choice Awards for 2021.

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  • placeholder
    Variable Home Loan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    1.99% p.a. variable
    1.99% p.a.

    Refinance only. Super-fast digital application process. Zero upfront fees. No on-going service fees. Free 100% offset sub account. Minimum 25% deposit required.

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  • placeholder
    Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    2.09% p.a.
    fixed 3 years
    2.32% p.a.

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $750,000.

    Go to site
    Details
  • placeholder
    Fixed Rate Home Loan

    Owner Occupier, Principal & Interest, LVR <80%

    interest rate
    comparison rate
    Initial monthly repayment
    2.09% p.a.
    fixed 3 years
    2.87% p.a.

    Ability to split your home loan between Fixed and Variable. Dedicated Relationship Manager. Min 20% deposit. Refinancers borrowing $250,000 or more could receive $3,288 cashback (T&Cs, eligibility and lending criteria apply).

    Go to site
    Details

* 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, loan amount and term entered. 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 Loan Awards

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