Home loan lenders still reducing interest rates despite stable RBA cash rate
Home loan interest rates went rogue last month, when 13 lenders cut variable rates on their mortgages, despite the RBA cash rate remaining stable since August.
According to Mozo’s latest Banking Roundup, the number of lenders who reduced home loan rates far outweighed those who didn’t.
While Bank Australia and Loans.com.au cut variable rate mortgages by 14 and 12 basis points respectively, the real highlight for borrowers came from AMP, who introduced a rate discount of 20 basis points for those borrowing over $500k with its “Essentials Home Loan”.
Despite the rate cut flurry that took place in October, Mozo data found that the best rates have remained unchanged.
Here are the top variable rate loans, according to our database:
| Product | Variable rate | Comparison rate |
|---|---|---|
| Reduce Home Loans Rate Buster Variable home loan* *Products no longer exists (as of 18/12/2018) | 3.35% | 3.42% |
| Homestar Owner Occupier loan Loans.com.au Essentials Variable home loan Mortgage House Special Variable Home Loan FreedomLend Variable Home Loan | 3.36% 3.39% 3.49% 3.53% | 3.49% 3.41% 3.93% 3.53% |
Plus, the top fixed rate loans:
- 1 year – 3.59% from Greater Bank (comparison rate 4.42%) and QT Mutual Bank (comparison rate 4.82%)
- 2 years – 3.59% from QT Mutual Bank (comparison rate 4.74%)
- 4 years – 3.74% from Greater Bank (comparison rate 4.34%)
- 5 years – 3.74% from Greater Bank (comparison rate 4.32%)
“If last month has shown us anything in the home loan market, it’s that Aussies have been given more choice when it comes to nabbing low interest rates,” said Mozo Director, Kirsty Lamont.
“In fact, some of the best deals in the market sit below the 3.5% mark. So for homeowners looking to free up some extra cash before the Christmas season hits, now could be an ideal time to refinance to a better deal.”
For instance, our research shows that a customer with a $400k mortgage on the average loan interest rate of 4.37%, who ditches it for the lowest rate loan of 3.35%, would pocket $2,681 annually or around $225 a month (on a 25 year loan term).
If you want to break up with your home loan lender and refinance, we know just the way to do it. Save time and money by comparing home loans at our data driven hub now!
* 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.
^See information about the Mozo Experts Choice Home Loan Awards
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