Home loan rates review - Spring 2017

Kirsty Timsans

31 Aug 2017

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Key Points

  • Spring home loan season kicks off with fierce rates competition

  • A record 66 lenders are now offering variable rates below 4.00%

  • Average Big 4 bank variable rate now 1.20% higher than lowest on market

Fierce lender competition for prime home loan customers is delivering a rate cut bonanza for owner-occupier borrowers this spring.

23 lenders have already cut variable rates to coincide with the spring property season, and Mozo’s data reveals that a record 66 lenders are now offering variable home loan rates below 4.00%. 

Aussie, ING, CommBank and Westpac are among lenders to cut variable rates in recent weeks, with more lenders expected to follow as peak property season heats up.

According to Mozo Director Kirsty Lamont, the level of competition on the home loan rates front is higher than usual this spring.

“Spring is traditionally peak season for home loan offers, and this season we’re seeing intense competition amongst lenders driving owner-occupier variable rates to new record lows”, said Ms Lamont.

Home Loan Rates - November 2017 - rates updated daily

  • loans.com.au

    3.64% p.a. variable

    3.66% p.a.

    $1234

    Product details Close details
    Essentials Variable 80

    A low-rate home loan that could save you thousands. No monthly or ongoing fees. Unlimited additional repayments. Unlimited free redraws with no minimum redraw amount. Winner of two Mozo Experts Choice Awards 2018 - Investor Home Loan & Low Cost Home Loan.^

    • 3.64% p.a. variable

    • 3.66% p.a.

    • $520

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • 80.00%

    • $50,000

    • $2,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Essentials Variable 80

  • HSBC

    3.59% p.a. variable

    3.61% p.a.

    $1234

    Product details Close details
    Discounted Home Value Loan

    Discounted rate for the life of the loan. A relationship manager to help you through the application process.

    • 3.59% p.a. variable

    • 3.61% p.a.

    • $150

    • $0.00

    • $300.00

    • yes - free

    • yes - free online

    • no

    • 90.00%

    • $50,000

    • $7,500,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Discounted Home Value Loan

  • UBank

    3.59% p.a. variable

    3.59% p.a.

    $1234

    Product details Close details
    UHomeLoan - Discount Offer

    A low rate Home Loan with no bank fees on variable rate loans. Easy & fast to apply. Choose between flexible repayments and make extra repayments for free on a variable rate home loan.

    • 3.59% p.a. variable

    • 3.59% p.a.

    • $0

    • $0.00

    • $0.00

    • yes - free

    • yes

    • no

    • 80.00%

    • $200,000

    • $699,999

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the UHomeLoan - Discount Offer

  • Newcastle Permanent

    3.89% p.a. variable

    4.29% p.a.

    $1234

    Product details Close details
    Discounted Variable Home Loan Premium Plus Package

    Experts Choice - Australia's Best Customer-Owned Banking & Home Lender of the Year 2018.^

    • 3.89% p.a. variable

    • 4.29% p.a.

    • $0

    • $395.00 yearly

    • $0.00

    • yes - free

    • yes - free

    • yes

    • 90.00%

    • $150,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Discounted Variable Home Loan Premium Plus Package

  • ME

    3.97% p.a. variable

    3.99% p.a.

    $1234

    Product details Close details
    Basic Home Loan

    No fees to redraw & low variable rate. Meet a mobile banker at a time or place that suits you.

    • 3.97% p.a. variable

    • 3.99% p.a.

    • $400

    • $0.00

    • $350.00

    • yes - free

    • yes - free

    • no

    • 80.00%

    • $40,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Basic Home Loan

  • Hunter United

    4.19% p.a. variable

    4.19% p.a.

    $1234

    Product details Close details
    Interest Only Owner Occupier Home Loan

    Interest Only could offer the relief you need. Get fast approval on a 2-year interest only owner occupied home loan of $300,000 or more.

    • 4.19% p.a. variable

    • 4.19% p.a.

    • $0

    • $0.00

    • $80.00

    • yes

    • yes - 1st redraw per month free

    • no

    • 80.00%

    • $300,000

    • -

    • Variable

    • Interest Only

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Interest Only Owner Occupier Home Loan

  • Virgin Money

    3.69% p.a. variable

    3.83% p.a.

    $1234

    Product details Close details
    Reward Me Variable Rate Home Loan

    Competitive rates from 3.69% p.a. Plus receive 20,000 Velocity Points for every $100,000 drawn at settlement.

    • 3.69% p.a. variable

    • 3.83% p.a.

    • $150

    • $10.00 monthly

    • $320.00

    • yes - free

    • yes - free

    • yes

    • 80.00%

    • $750,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Reward Me Variable Rate Home Loan

  • Hot Deal QLD only

    QBANK

    3.84% p.a. variable

    3.87% p.a.

    $1234

    Product details Close details
    Discounted Classic Home Loan

    A low variable Home Loan rate with no monthly fees and flexible repayments.

    • 3.84% p.a. variable

    • 3.87% p.a.

    • $195

    • $0.00

    • $200.00

    • yes - free

    • yes - free

    • no

    • 90.00%

    • $150,000

    • $2,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Discounted Classic Home Loan

  • Aussie

    3.84% p.a. variable

    3.85% p.a.

    $1234

    Product details Close details
    Select Basic Variable

    A low rate loan with a range of features, no ongoing management fees, and discounted interest rates to best fit your particular situation.

    • 3.84% p.a. variable

    • 3.85% p.a.

    • $330

    • $0.00

    • $535.00

    • yes - free

    • yes - free

    • no

    • 80.00%

    • $100,000

    • $5,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Fortnightly, Monthly

    Read our Mozo Review to learn more about the Select Basic Variable

  • AMP

    3.74% p.a. variable

    4.13% p.a.

    $1234

    Product details Close details
    Variable Rate Loan Professional Package

    Benefit from 100% loan offset account with variable rate loan. Redraw any extra funds whenever you like, with no withdrawal fees!

    • 3.74% p.a. variable

    • 4.13% p.a.

    • $295

    • $349.00 yearly

    • $350.00

    • yes - free

    • yes

    • yes

    • 90.00%

    • $500,000

    • $749,999

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Variable Rate Loan Professional Package

*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.

Look beyond the big banks for the best rates

Borrowers who choose smaller lenders over the big banks can access huge rate savings right now. The average big 4 bank variable rate for a $300,000 owner-occupier loan is 4.64%, a whopping 1.20% higher than the lowest available rate of 3.44%. 

“Owner-occupiers looking to buy a home or refinance their current home can secure an incredibly competitive home loan deal this spring if they’re prepared to shop around and consider loans from smaller lenders”, said Ms Lamont.


Rates not so rosy for investors

On the other side of the coin, housing investors are still feeling the pain of APRA’s risky lending regulations.  Australia’s new two-tier home loan interest rate market sees investors continue to pay more for debt and face stricter lending criteria.

Investors are typically paying an interest rate premium of around 27 basis points compared to owner occupier borrowers, according to Mozo's data.


How to secure the best home loan this Spring:

1. Jump online to compare the best home loan rates on the market

2. Be prepared to look beyond the big banks and go with a smaller lender

3. Go for principal  & interest repayments as interest only loan rates are higher

4. Check for upfront fees, ongoing fees and any exit fees on your current loan if you’re refinancing

5. Consider loan features that can help reduce your interest and pay off your loan faster, like free extra repayments and an offset account


Interest rates and home loan data in this article are correct as of time of writing. Average rates based on $300,000 owner-occupier loan with 80% LVR.

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