Lenders have been cutting rates left and right for months now, but it’s still rare for a home loan to offer headline rates below the 2.00% mark. Recently, online lender Homestar came out with a new offer that sees it joining this exclusive club.
The Star Classic Owner Occupied Special sports an impressive 1.98% p.a. fixed rate (2.51% p.a. comparison rate*), which is available for one year before reverting to a still competitive 2.49% p.a. (2.51% p.a. comparison rate*).
That headline rate puts it a full 62 basis points below the average 1-year fixed home loan rate in our database.
The loan is available to owner-occupiers making principal and interest repayments on loans between $150,000 and $850,000. The LVR is capped at 80%, meaning you’ll need to have a deposit of at least 20% of a property’s value to be eligible.
Importantly, the offer is only available for a limited time, and applications must be received by 30 September 2020 and settled by 31 December 2020. An application fee of $495 will also apply.
Along with the rock-bottom rate, the Star Classic Special comes with a bevy of features, including the ability to split your loan, make extra repayments (maximum $20,000 per year), and access a free redraw facility in case you want those extra funds back in your pocket.
Its rollout comes not too long after loans.com.au unveiled the Smart Booster Home loan, which comes with a discounted variable rate of 1.99% p.a. (2.55% comparison rate*) for the first year, before reverting to 2.57% p.a.
Both offerings represent excellent value for both refinancers and new buyers. Among home loans we track, the average 1-year fixed rate for a $400,000 owner occupier loan is 2.61% p.a., while the average variable rate on a loan of the same size is 3.40% p.a.
We’ve included a snapshot of the Star Classic Owner Occupied Special below. For a look at other offers, visit our home loans comparison page, where you’ll be able to filter your search by rate and type.