May home loans snapshot: HSBC and ING emerge as new fixed rate leaders

By Tom Watson · · 4 min read
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In good news for Australian borrowers and refinancers, the recent downward trend in home loan interest rates has continued, according to new Mozo research released this morning.

Figures from the latest Mozo Banking Roundup reveal that mortgage lenders continued to drop both home loan rates throughout May, but as in previous months, changes to fixed rates largely outweighed those to variable rates. 

Among the most significant recent fixed rate movements, AMP slashed 35 - 185 basis points off select fixed package loan rates while neobank 86 400 cut its own fixed rate offers by between 15 - 25 basis points. 

On the flip side, ANZ increased fixed rates on its Breakfree Package loan by up to 10 basis points, while online lenders Reduce Home Loans and Well Home Loans also increased what were previously rate-leading offers. 

The increases from Reduce and Well now leave HSBC and ING sitting pretty as the rate leaders in the Mozo database in four of five fixed rate terms. Here are the five database-leading fixed rates and the Mozo averages as of June 1, 2020:

TermRate leaderFixed rateAverage
1 yearNewcastle Permanent2.18% (3.83% comparison rate*)3.03%
2 yearHSBC and ING2.09% (3.09% and 3.77% comparison rates*)2.98%
3 yearING2.14% (3.62% comparison rate*)3.01%
4 yearHSBC2.40% (3.13% comparison rate*)3.36%
5 yearING2.54% (3.50% comparison rate*)3.38%

Variable rates trend down

While there was a lower volume of variable home loan rate changes in May compared to fixed changes, cuts continued to flow.

There was a bit of jostling at the most competitive end of the market, with three lenders - Homestar, Reduce Home Loans and Tic:Toc - now offering a variable rate of 2.39% for owner occupiers. That’s currently the lowest in the Mozo database. 

Online lender Homestar has cut its Star Essentials loan by 5 basis points to 2.39% (2.39% comparison rate*) and Tic:Toc shaved 15 basis points off its Variable Home Loan meaning that it also sits at 2.39% (2.40% comparison rate*). 

The Reduce Home Loan Rate Slasher rate of 2.39% (2.40% comparison rate*) remains unchanged. 

As a result of the various rate changes, the average variable rate in the Mozo database (based on a $400k, OO, P&I loan with an 80% LVR) dropped fractionally over the month from 3.44% to 3.43%.

RELATED: Macquarie Bank slashes fixed rates by up to 0.35%

Don’t think your current home loan rate is up to scratch anymore? Find out just how much you could save by using our handy switch and save calculator, or see how it stacks up against some of the hot offers in the table below.

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Last updated 14 September 2024 Important disclosures and comparison rate warning*

Fixed home loan comparisons on Mozo

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  • Fixed Express Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.99 % p.a.
    Fixed 2 years
    Comparison rate
    6.14 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).

  • 3 Year Special Fixed Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.69 % p.a.
    Fixed 3 years
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $2,899
    Go to site

    This home loan is available for purchase or refinance, complete with 1, 2 or 3 year fixed rate options. Minimum 10% deposit required.

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* 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. You can change the loan amount and term in the input boxes at the top of this table. 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.

^See information about the Mozo Experts Choice Home Loan Awards

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.

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