Borrowers dump banks after royal commission

Kelly Emmerton

13 May 2019

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The big banks are feeling the heat in the wake of the royal banking commission, with borrowers switching to online and challenger lenders and deserting the big four in droves. 

New research from Mozo shows that borrowers are more open to online lenders than ever, with the lower rates and fees on offer viewed as the biggest benefit of applying for a loan online. What's more, online lenders are taking advantage of the nation's disgust with the big banks by cutting rates and launching new ultra low rate loans guaranteed to get even more borrowers switching.

So if you're looking for a more flexible way to borrow at a low rate, check out these great value home loan and business loan options from rival lenders:

BANK BEATING HOME LOANS

Promoted

loans.com.au Smart Home Loan
  • 3.48% variable rate (3.50% comparison rate*)

  • No application or ongoing fees

  • Unlimited free extra repayments and redraw facility

Our verdict

Loans.com.au is a popular online lender offering some of the lowest rates around. The brand new Smart Home Loan comes with a super sharp variable interest rate, no application or ongoing service fees and heaps of helpful features like free extra repayments, a redraw facility plus the option to split your loan between fixed and variable rates. It's no wonder loans.com.au is a perennial Mozo Experts Choice Award winner for best value home loans!

Where do I get it? Head over to loans.com.au to find out more >>

Promoted

UBank UHomeLoan - Discount Offer
  • 3.59% variable rate (3.59% comparison rate*)

  • $0 application fee or ongoing fees

  • Free extra repayments and redraw facility

Our verdict

UBank is another online lender proving popular with Aussie borrowers for super low home loan rates, not to mention the fact that it's actually backed by NAB. The UHomeLoan Discount Offer comes with no annual or application fees plus flexible features like the option to split between fixed and variable rates, make free extra repayments, access a free redraw facility and choose weekly, fortnightly or monthly repayments to fit your budget.

Where do I get it? Head over to UBank to find out more >>

Promoted

Athena Variable Home Loan
  • 3.59% variable rate (3.55% comparison rate*)

  • Free extra repayments and redraw facility

  • No upfront or ongoing fees

Our verdict

The new Athena Variable Home Loan is a competitive refinance mortgage with a 3.59% variable rate (3.55% comparison rate*) and no application, valuation or ongoing fees. But don’t think the value ends there, the loan also offers free extra repayments and a free redraw facility. Just keep in mind, if you’re a first home buyer, you won’t be able to get this loan as it’s only for refinancers, living in capital or major regional cities.

Where do I get it? Head over to Athena to find out more >>

Promoted

Homestar Star Essentials Home Loan
  • 3.49% variable rate (3.49% comparison rate*)

  • Unrestricted extra repayments and free online redraw

  • Upfront fees waived for a limited time

Our verdict

Homestar has been providing affordable home loans since 2004, cutting out branches and brokers to deliver better rates and award-winning mortgages. The Star Essentials is an ultra low variable rate home loan for owner occupier refinancers with at least 80% equity. There are no monthly or ongoing fees, and if you're borrowing between $200K and $750K you can have valuation and legal fees waived when you apply by 28 June. What are you waiting for?

Where do I get it? Head over to Homestar to find out more >>

BANK BEATING BUSINESS LOANS

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Moula Business Loan
  • Interest rates from 1.00% per fortnight

  • Approval in 24 hours for loans up to $250,000

  • $0 upfront or ongoing fees

Our verdict

With an all online and hassle free application process, Moula is set up to help Aussie businesses get the funding they need, when they need it. No fees and competitive interest on this loan keeps your business costs low and if you’re applying for a loan up to $250,000 you can be approved in as little as 24 hours. Just keep in mind that to be eligible for this one, you need to have been operating for at least 6 months, have an ABN or ACN, and turnover at least $5,000 each month.

Where do I get it? Head over to Moula to find out more >>

Promoted

Prospa Business Loan
  • Fast same day approval and funding

  • Borrow $5,000 to $250,000 for terms of 3 to 12 months

  • Apply online in 10 minutes

  • No security required

Our verdict

Prospa is Australia’s leading online lender to small business, offering fast and flexible loans for any business purpose. This innovative Australian-owned lender focuses on removing the obstacles that have made it difficult for SMEs to access funding. A director’s guarantee is all that’s required as security, so there’s no need to put your house on the line. What’s more, Prospa assesses creditworthiness based on the health of the business, not the owner’s personal credit score.

Where do I get it? Head over to Prospa to find out more >>

*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.

Want to check out some other excellent borrowing options? Head over to our home loan comparison table, or our business loan comparison tool to get started.


*https://www.afr.com/business/b...

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