Rates plunge below 2 percent for home borrowers

Just when we were starting to get used to home loan rates that start with a '2', Australia's challenger lenders are now rolling out home loan rates with a '1' in front, offering even more opportunities for savvy borrowers to compare and save.
Popular online lender loans.com.au, which has been taking on the banks with low rate online home loans since 2011, is making waves with a new 1.99% variable 1 year home loan rate (2.55% comparison rate). Not to be outdone, Homestar and Tasmanian lender Bank of Us have also dropped some of their fixed home loan rates below 2%.
While we're yet to see other lenders go this low, HSBC is now offering a 2 year fixed home rate under 2.10%, while UBank has dropped its already competitive variable rate below 2.50%.
These ultra low rates offer potential savings of tens of thousands of dollars for borrowers who are prepared to shop around. Read on for the Mozo Expert guide to the new headline-grabbing loans.com.au home loan with a '1' and our round-up of the other top new rates on the market right now.
HOME LOAN RATES UNDER 2%
loans.com.au Smart Booster Home Loan

1.99% discount variable rate for 1 year
Rolls over to low ongoing 2.57% (2.55% comparison rate*)
No monthly fees plus unlimited free redraws and extra repayments
The details:
Loans.com.au has been taking on the banks with low rate loans for close to a decade, and the new Smart Booster Home Loan might just be their best yet. Available to borrowers with a 20% deposit, this headline-stealing home loan is designed to help you boost your savings, build your equity and own your own home, sooner. Flexible features include free extra repayments and redraw, multiple loan split options and the choice of weekly, fortnightly or monthly repayments. What's more, there are no ongoing monthly or annual fees.
Homestar Star Classic Fixed Home Loan

1.98% fixed rate for 1 year (2.51% p.a. comparison rate*)
Free extra repayments (up to $20,000 annually)
Borrow between $150,000 and $850,000
The details:
The Star Classic Owner Occupier Special boasts a killer new 1 year fixed rate that reverts to a low 2.49% (2.51% comparison rate*), putting it among only a handful of loans with headline rates below 2.00%. Refinancers and new purchasers will be able to enjoy plenty of flexibility, including the option to pay down your loan faster by making extra repayments up to $20,000 year without penalty during the fixed period. You'll also have access to a free online redraw facility.
TOP FIXED RATE BANK HOME LOAN
HSBC 2 Year Fixed Rate Home Loan

2.09% fixed rate for 2 years (2.98% comparison rate*)
No upfront application or ongoing service fees
Free extra repayments up to $10,000 a year
The details:
This market leading 2 year fixed rate home loan lets you guarantee your monthly repayments while still taking advantage of flexible features like the ability to make free extra repayments up to $10,000 a year and split your loan between fixed and variable rates. What's more, there are no upfront or ongoing fees and you'll get a relationship manager to help you through the application process. Available to borrowers with 20% deposit for loans of $50,000 or more.
ULTRA LOW NEW VARIABLE RATE
UBank UHomeLoan - Discount Offer

New 2.49% variable and comparison rate*
Free extra repayments and redraws
Zero fees
The details:
UBank has made a name for itself as one of Australia's best value online lenders, and this seriously low new variable rate is case in point. As you'd expect from a multiple Mozo Experts Choice 2020 Award Winner, the UHomeLoan is packed full of other benefits including zero fees and the flexibility for borrowers to make free extra repayments towards the loan and redraw those repayments down the track (if they need to). It's available for loans of $200,000 plus with a minimum deposit or 20% or more.
^See information about the Mozo Experts Choice Home loans Awards
Want to compare more home loans? View the latest mortgage rates from over 80 lenders at Mozo's home loan comparison hub.
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