UBank, Bendigo Bank among latest lenders to announce cuts

By Niko Iliakis ·

UBank customers who logged onto the UBank app over the weekend were greeted by some pleasant news: the online bank has opted to pass on the RBA’s cut in full to its variable home loan customers.

The decision will see rates for UBank’s popular UHomeLoan drop as low as 3.09% p.a. (3.09% p.a. comparison rate*). Both new and existing customers will be able to enjoy the new rates, but unfortunately, there will be a bit of a wait — the changes will come into effect on 2 August.

Once in place, owner occupiers paying off a $400,000 UHomeLoan (Discount Offer) over 30 years can expect to save $55 each month, or $660 over a year thanks to the new rate.

Bendigo Bank, MyState Bank reduce rates by 0.20%

Decisions from other lenders in the past few days have been a bit of a mixed bag. Bendigo Bank announced it will be reducing rates by 0.20% for owner occupiers and 0.15% for investors. The changes will take effect on 29 July, and will apply to new and existing customers.

Bendigo Bank Managing Director, Marnie Baker said the decision aims to balance the interests of a variety of stakeholders, and uphold “the strength of our national network which supports the prosperity of communities across the country.”

Meanwhile, MyState Bank also revealed it will be decreasing variable rates by 0.20%. The new rates will be available to new customers on 15 July, while existing customers will have to wait until 29 July for relief to come their way.

Who else has made cuts?

Bank Australia also made moves over the weekend, announcing it will be reducing variable rates by 0.16%. The changes will take effect on 22 July, and will apply to all owner occupiers and investors.

We saw a similar move from Bank of Queensland and Virgin Money, who both announced plans to reduce variable rates for new and existing customers by 0.15% on 23 July. 

Decisions like these aren’t likely to be appreciated by home loan customers, but will come as welcome news to savers. After all, when banks make reductions to home loan rates in the wake of an RBA decision, cuts to savings accounts and term deposits usually follow.

As Lyn McGrath, Group Executive of Retail Banking at BOQ put it, “With interest rates now at historical lows, it is critical that we balance our ongoing support for borrowers with those of our depositors.” 

Nonetheless, if you’re unsatisfied with your bank’s decision, or believe the home loan rates on offer elsewhere are more worthy of your attention, be sure to head to our variable rate home loan comparison page, or check out some of the options below.

Home loan comparisons on Mozo - last updated January 23, 2021

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    UHomeLoan - Discount Offer

    Owner Occupier, Principal & Interest

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    2.34% p.a.
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    Celebrate Variable Home Loan

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    2.19% p.a.
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  • Basic Home Loan

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  • Back to Basics Special

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    2.54% p.a.
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