Home loan rates starting with ‘1’ pile up after RBA cut

Home loan rates starting with ‘1’ pile up after RBA cut

Home loan interest rates just keep dropping, reaching new low levels following the Reverse Bank’s November rate cut.

According to the latest figures from the Mozo database, 35 banks and lenders are currently offering at least one home loan with a rate starting with a ‘1’ and more are likely to follow suit in the coming weeks as cuts continue to trickle through.

The vast majority of these super low rates are fixed home loan offers. And while the trend from lenders earlier this year was towards aggressively cutting shorter term fixed rates, we’re now seeing 4 and 5-year rates start to catch up.

So whether you’re looking to refinance or take out a loan to buy a new home, here’s a snapshot of some of the loans on the market which start with a ‘1’.

Low rate home loans

Loans.com.au - Smart Booster Home Loan
  • 12-month 1.99% intro rate (2.47% comparison rate*)
  • Competitive ongoing variable rate of 2.48%
  • Optional offset account

The Smart Booster Home Loan from loans.com.au not only offers owner occupiers the chance to snag a super low introductory rate of 1.99% (2.47% comparison rate*) for 12 months, the ongoing variable rate is a competitive 2.48%. Borrowers can also make use of extra repayments, free redraws and an optional offset account (for an additional 0.10% interest loading) - all without an ongoing service fee. Though there are some upfront fees to budget for.

Bank of Queensland - Fixed Rate
  • 4-year fixed rate of 1.99% (2.90% comparison rate*)
  • Free extra repayments (up to $5k p.a.)
  • $3,000 cashback for eligible refinancers

Starting at 1.99% (2.90% comparison rate*) for a 4-year term, BOQ’s Fixed Rate home loan has some of the sharpest fixed rates around. The low rates alone might be appealing enough, but the loan also comes with handy features like extra repayments (free up to $5,000 per year), a split rate option and $3,000 cashback for eligible borrowers refinancing loans of $250k or more. Just remember to weigh up these benefits against the $10 monthly service fee and the $450 worth of upfront fees.

UBank - UHomeLoan (Fixed)
  • 3-year fixed rate of 1.95% (2.36% comparison rate*)
  • Zero ongoing fees
  • Free extra repayments (up to $20k yearly)

Online bank and NAB subsidiary, UBank, has a new ultra low offer of just 1.95% (2.36% comparison rate*) for a 3-year fixed term that’s sure to please borrowers who are happy to lock in their rate. The UHomeLoan (Fixed) also gives borrowers the choice of making extra repayments of up to $20,000 p.a. (for free) and there are no ongoing service fees to worry about budgeting for!

Suncorp - Fixed Home Loan Special Offer
  • 2-year fixed rate of 1.89% (2.94% comparison rate*)
  • Up to $3,000 cashback
  • Free extra repayments (up to $500/month)

Suncorp has taken its fixed rates to new lows, launching a 2-year rate of just 1.89% (2.94% comparison rate*) for owner occupiers. The loan also gives borrowers the option of making up to $500 in extra repayments each month for free, though there’s a $375 annual service fee to consider (waived in the first year). For a limited time, Suncorp is also giving eligible refinancers between $2k-$3k cashback when they apply for a new loan of at least $250k before December 18 and settle by March 26, 2021.

HSBC - Fixed Rate Home Loan
  • 2-year fixed rate of 1.88% (2.95% comparison rate*)
  • Loans from $50,000 to $7,500,000
  • Zero upfront or ongoing fees

That’s not a typo, HSBC really is offering a 2-year fixed rate of just 1.88% (2.98% comparison rate*) with its Fixed Rate Home Loan for owner occupiers with an LVR below 80%. Aside from the low rate, borrowers may be pleased to know that the loan also allows extra repayments (free up to $10k p.a.) and apart from the $300 discharge fee there are no other upfront or ongoing fees to worry about.

Curious to find out if you could switch to a loan with a lower rate? Check out our refinance home loan table to look through a range of loans for refinancers all in the one place.

*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.

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.