In a rates dream for home borrowers, Australia's challenger lenders are competing to roll out ultra low variable and fixed home loan rates with a '2' in front, offering potential savings of tens of thousands of dollars for borrowers who are prepared to compare and switch.
Since the RBA cut the cash rate to a historical low of 0.25%, popular online lenders such as UBank and Homestar have raced out of the blocks to drop their rates below a jaw-dropping 2.60%.
Meanwhile, challenger lenders like HSBC and People's Choice are putting the pressure on the the big 4 banks by reducing their already competitive fixed and variable home loans well below 3.00%.
So if you’ve been holding out for the right home loan, here are some of the top loans currently on the market to get your search off to a smashing start.
Looking for a loan that's easy on your wallet? Look no further than the Smart Home Loan 80 from popular online lender loans.com.au. This low rate, low fee mortgage is packed with handy features like the option to make free extra repayments, unlimited free redraw and a split rate option. With all this value on offer and no pesky fees to boot, it's no surprise the Smart Home Loan took out a Mozo Experts Choice Low Cost Home Loan Award for 2020.
HSBC Fixed Rate Home Loan
2.09% fixed rate for 2 years (2.98% comparison rate*)
This great value 2 year fixed rate home loan gives you the security of monthly repayments while still taking advantage of flexible features like the freedom to make free extra repayments up to $10,000 a year. You’ll also be able to split your loan between fixed and variable rates, and the cherry on the top; there are zero application and ongoing fees to pay. You'll even get a free relationship manager to guide you through the application process. Available to borrowers with a 20% deposit or more.
This cracking variable loan from UBank is a bona fide mortgage crusher. There are no upfront or ongoing fees and you can choose to make monthly, fortnightly or weekly repayments to suit your budget plus take advantage of free extra repayments and redraw. UBank is backed by NAB and its UHomeLoan is available for borrowers with a deposit of 20% or more, and for loans of $200,000 or more.
Suncorp Fixed Home Loan Special Offer
1.89% fixed rate for 2 years (2.94% comparison rate*)
Free extra repayments up to $500 each month
Annual package fee waived in the first year for new customers
Suncorp’s Home Package Plus home loan is rewarding its borrowers with an amazingly low sub 2% interest rate combined with the certainty of a fixed rate for 2 years. On top of that, you’ll score a $3,000 cash bonus when you take out a loan of $250,000 or more (T&Cs apply). Together with no loan establishment fee and up to $500/month extra repayments, this home loan is definitely one to check out.
Homestar Star Essentials Home Loan
New 2.14% p.a. variable rate (2.17% p.a. comparison rate*)
Free online redraws and unrestricted extra repayments
No monthly or ongoing account fees
Homestar has been offering affordable home loans to Aussie borrowers since 2004, and the Star Essentials home loan is no exception. This stellar loan boasts one of the lowest rates on the market while still delivering great features like free online redraws, unrestricted extra repayments and multiple loan splits. You can borrow up to $850,000 with this loan as long as you have a deposit of 20% or more. Plus, refinancers receive up to $1,500 cashback or upfront fees waived on purchases for applications received by 30 November, 2020.
*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 the amount and term you entered.
**Initial monthly repayment figures are estimates only, based on the advertised rate, and a loan of $500,000 repaid over 25 years. 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.