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Following the outbreak of the novel coronavirus, and the Reserve Bank of Australia’s (RBA) emergency cash rate cut, now may be the time to think about locking in a fixed home loan rate.  

In response to the rapid spread and emerging financial effects of COVID-19, the RBA made the extraordinary decision to cut its official cash rate twice this month, dropping it to an historic low of 0.25%. (The first time they’ve cut rates ‘out of cycle’ since 1997).

Recent Mozo research also showed that 87% of Aussies are fearful of how the times ahead will impact them financially. 

“The Coronavirus pandemic has and will hit many Aussie homes economically, and Mozo’s latest research proves that the majority of us are worried about what’s to come,” Mozo Director, Kirsty Lamont said. 

“Since the RBA’s emergency rate cut last week, lenders have been slashing fixed interest rates - so in this unstable financial environment, locking in a low fixed home loan rate could be a smart move for mortgage customers.” 

So what difference has the RBA cut made to fixed home loan rates? 

After the first cut on 3 March 2020, 19 home loan lenders in the Mozo database dropped their fixed rate offerings. 

Then, after the second emergency rate cut on 19 March 2020, 18 providers slashed rates, some of which were the same providers who responded to the first cut, making it the second time for them this month. 

And notably, all four of the big banks: ANZ, CommBank, NAB and Westpac, made changes to fixed home loans after the most recent rate cut.  

“While it’s true that variable rates are at an all time low, due to the turbulence of the current market, Aussie lenders could soon see higher funding costs which will then affect their customers,” Lamont said. 

“So locking in a fixed rate now, may help alleviate the stress if variable rates were to hike back up.” 

According to the Mozo database, the lowest fixed rate is offered by ING - at 2.09% on its 2 year fixed term and 2.14% on its 3 year fixed term, while the lowest variable rate sits at 2.44%. 

It’s important to remember, however, reversion rates on fixed home loans tend to be significantly higher than the fixed rate and some standard variable rates. 

RELATED ARTICLE: Experts urge Aussies to opt for fixed home loan rates, following emergency RBA cut

Want to check out some fixed home loan options? Check out the table below or jump over to our fixed home loan comparison tool for even more providers.

Fixed Home Loans 2020 - rates updated daily

Search promoted home loans below or do a full Mozo database search. Advertiser disclosure.
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    UHomeLoan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    1.85% p.a.
    fixed 3 years
    2.24% p.a.

    $0 fees and easy application. Choose between weekly, fortnightly or monthly repayments. 3 year fixed rates are for new Owner Occupier Principal & Interest loans.

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    Details
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    Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    2.09% p.a.
    fixed 3 years
    2.32% p.a.

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $750,000.

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    Details
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    Special Offer Reward Me Fixed Rate Home Loan

    Owner Occupier, LVR <80%, 300k+

    interest rate
    comparison rate
    Initial monthly repayment
    1.98% p.a.
    fixed 2 years
    2.66% p.a.

    Enjoy $3,000 cashback when you refinance with Virgin Money (T&Cs apply). Additional repayments up to $10,000 per annum. Reverts to the discounted variable rate on expiry of the fixed term.

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    Details
  • Hot DealReceive $2,000 cashback when refinancing to 86 400 (T&Cs apply)
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    Own Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR <60%

    interest rate
    comparison rate
    Initial monthly repayment
    1.84% p.a.
    fixed 1 year
    2.63% p.a.

    Competitive fixed rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.

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    Details
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    Special Fixed Rate Home Loan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    1.89% p.a.
    fixed 2 years
    3.67% p.a.

    Lock in a low fixed rate or choose to split your loan between fixed and variable. Insurance discounts and no fee credit card or zero fee personal loan available. $2,000 cashback offer for home loans over $250k with at least a 20% deposit when refinancing to Newcastle Permanent. Enjoy local branches and call centre.

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    Details
  • Hot DealReceive $3,288 cashback when refinancing to HSBC (T&Cs apply)
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    Fixed Rate Home Loan

    Owner Occupier, Principal & Interest, LVR <80%

    interest rate
    comparison rate
    Initial monthly repayment
    1.88% p.a.
    fixed 2 years
    2.86% p.a.

    Ability to split your home loan between Fixed and Variable. Dedicated Relationship Manager. Min 20% deposit. Refinancers borrowing $250,000 or more could receive $3,288 cashback (T&Cs, eligibility and lending criteria apply).

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    Details

* 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.

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