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.