Mozo Money Moves: Fixed rates tumble, ‘Bank of Mum and Dad’ is now a gift, and RBA could pull the trigger on a double rate cut

Welcome to Mozo Money Moves, your go-to weekly finance wrap, unpacking the latest shifts in Australia’s financial landscape.

This week fixed rates fell across the board – some now starting with a 4, banks repriced dozens of home loan products, ANZ trimmed key deposit rates, and the latest ‘Bank of Mum and Dad Report’ revealed just how far Aussie parents are stretching to help their children buy property.

Whether it’s the First Home Guarantee influencing property dynamics or banks revamping products like CBA’s new Simple Home Loan, the competition is fierce in the lead up to the next cash rate decision on 20 May. App-based banking is heating up too, while super funds like Aware Super and HESTA battle for the top spot.

Here’s everything that moved in the world of rates and finance this week.

'Bank of Mum and Dad' digs deeper: $74k gift not enough

This year’s Bank of Mum and Dad Report reveals just how financially entrenched Aussie parents have become in their children’s property journeys. According to the research, parents are now contributing an average of $74,000 towards house deposits – the highest amount ever recorded.

But this is more than just generosity, it’s financial sacrifice. The report found:

• 1 in 3 first home buyers received parental assistance.
• 53% of parents dipped into personal savings.
• 14% delayed retirement or accessed superannuation.
• 11% refinanced their own home to unlock equity.
• More than 1 in 4 are concerned about the impact on their own financial future.

Despite these large contributions, Mozo modelling shows a $74k gift is often still not enough to cover a 20% deposit on median homes in Sydney or Melbourne, especially with stamp duty and other upfront costs factored in. Dual incomes remain essential, and many first home buyers still fall short of lending thresholds even with family support.

Critically, the vast majority of parental gifts are informal, lacking any formal agreement or protection. That leaves both parties exposed if circumstances change. As house prices continue to outpace wage growth, the role of the ‘Bank of Mum and Dad’ is becoming both more vital and more financially perilous.

Dive deeper:

• Aussie parents now gifting an average $74k for house deposits
• $74k parental gift not enough to escape housing affordability crisis
• Mozo ‘Bank of Mum and Dad’ Report 2025

RBA poised for big rate call amid economic pressures

The Reserve Bank of Australia (RBA) is widely anticipated to implement an interest rate cut at its upcoming meeting on 20 May 2025. Economic indicators, including stagnant retail spending and rising living costs, have intensified calls for monetary easing.

Notably, the Australian Bureau of Statistics’ (ABS) Selected Living Costs Index, released this week, revealed mortgage interest charges for employee households have surged by 163% since March 2022, leading to a 20.7% increase in their cost of living, compared to a 13.6% rise in overall inflation.

National Australia Bank (NAB) forecasts a 50 basis point reduction in the cash rate this month, with expectations of further cuts bringing the rate down to 2.60% by February 2026.

The table below shows potential savings for mortgage holders at varying rates:

May shakeup: Lenders slash fixed home loan rates – some now starting with a 4

In one of the biggest weeks for fixed rate changes this year, we saw sweeping cuts across dozens of products from regional banks and credit unions, as well as one of the Big Four.

ANZ dropped a range of its fixed home loan rates this week, offering borrowers a bit of breathing room in a market that’s still digesting the RBA’s February rate cut.

For owner-occupiers fixing their rate for one or two years, the changes are pretty eye-catching. And investors haven’t been left out either, with solid reductions across the board.

ANZ (Fixed Rate Home Loan <80% LVR)

Bank of Queensland (BOQ) rolled out some healthy fixed rate cuts this week, and a few now start with a 4, which we haven’t seen from them in a while. These changes mostly apply to owner-occupier and investor loans across two- to five-year terms.

Bank of Queensland (Discount Fixed Rate Home Loan <80% LVR)

Late last week, Police Bank trimmed a range of fixed home loan rates, with several flagship products now offering headline rates starting with a 4. These changes span across a number of different products – and the three-year terms are looking particularly sharp.

Police Bank (Fixed Rate Home Loans)

Notes on Police Bank loans' LVR eligibility:

• First Home Loan is available to owner-occupiers with LVRs between 80% and 98%.
• Goldrate Home Loan covers LVRs up to 95%, with specific options for <60% and 60–80%.
• Police Value Home Loan is available to owner-occupiers with LVRs up to 90%.
• Investor loans apply across multiple LVR tiers, with the 4.99% rate showing up for <60%, 60–80%, and >80% brackets.

Greater Bank (Ultimate and Great Rate packages – LVR <90%)

Newcastle Permanent (Premium Plus packages – LVR <95%)

The Capricornian (Fixed Premium Choice and Investment Loan - LVR <80%)

These movements reinforce a trend first noted in Mozo’s April 2025 Banking Roundup: fixed rates are on the decline, with lenders anticipating future RBA easing or simply responding to market demand for price certainty. Check out the best rates available below.

Lowest fixed rates on Mozo’s database

Variable loan cuts sweep through mutuals

Several second-tier and mutual lenders cut variable rates across their owner occupier and investor products this week. 

The changes reflect sharpening price competition in the mid-tier lending space, as banks look to capture the refinancing market amid slowing new borrower growth.

Check out a couple of the highlights below and search Mozo’s database for more:

Greater Bank – Great Rate Home Loan (Discount variable rate)

Newcastle Permanent – Real Deal (Special)

*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 is calculated on a loan amount of $150,000 for a term of 25 years based on monthly repayments. For variable interest-only loans, comparison rates are based on an initial five year interest only period.

Virgin Money withdraws new home loan applications

In a less common move, Virgin Money has withdrawn its entire range of fixed and variable home loans, encompassing all ‘Reward Me’ products for owner occupiers and investors.

All loan tiers – by LVR, loan size, and repayment type – are now unavailable to new applicants. While the bank has not issued a statement, this typically signals a pending product refresh or repricing strategy. Stay tuned for more information.

This move may have been anticipated, as Virgin Money was the only lender in the Mozo database that didn’t pass on any rate cut after the RBA lowered the cash rate in February.

CBA tweaks Digi Home Loans, launches Simple product

The Commonwealth Bank adjusted rates on its Digi Home Loan this week, cutting up to 0.06% p.a. from new lending offers.

In parallel, CBA rolled out its new Simple Home Loan – a stripped-back mortgage for borrowers seeking ease and speed. It features:

• Variable P&I rates from 6.09% p.a. (comparison rate* 6.34% p.a.)
• LVR tiers up to 95%
• $20 monthly fee
• Cashback and reward offers for “Yello” transaction account users

You can discover more about the new loan on Commbank’s website.

*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. For variable interest-only loans, comparison rates are based on an initial five year interest only period.

ANZ trims term deposit rates across popular terms

ANZ adjusted a range of its Advance Notice term deposit rates, cutting up to 0.10% from several popular terms. The bank’s 8-month rate (previously the standout at 4.25%) is down to 4.20%.

These updates align with broader industry trends. Mozo data shows over two-thirds of providers have reduced term deposit rates since April, reflecting less aggressive competition for funds.

First Home Guarantee reshaping property dynamics

The Australian government's relaunch of the First Home Guarantee scheme, effective from 1 January 2026, is expected to have a pronounced impact on the residential property market, particularly in the sub-$1 million segment. 

The scheme allows eligible first-time buyers to purchase homes with a 5% deposit, bypassing the need for lenders mortgage insurance (LMI). An estimated 80,000 potential buyers are anticipated to delay their purchases until the program's commencement, potentially leading to a brief suppression of home prices in late 2025. However, some experts predict a subsequent price surge of 8-15% in early 2026, especially in urban areas favoured by first-home buyers.

Additional factors contributing to this anticipated market shift include potential interest rate cuts by the RBA and policy changes allowing banks to disregard student HECS debts when assessing mortgage capacity. These developments underscore the importance for prospective buyers to consider market timing in their property acquisition strategies.

App-based banking battle heats up

As mobile banking becomes increasingly central to customer experience, Mozo explored which providers are innovating and which ones are lagging behind.

In our recent article on banking in the era of apps, standout features included:

• Instant card control and in-app PIN resets
• Real-time spending alerts
• Goal-based savings and budgeting tools

For many younger Australians, a slick app experience is now more important than branch access or even rate competitiveness – making digital agility a key differentiator in the sector.

Aware Super vs HESTA: which fund wins?

In superannuation news, Mozo compared two of Australia’s biggest industry funds in this in-depth analysis.

Aware Super and HESTA both offer strong long-term returns, but differ on structure and strategy:

• Aware Super: more investment options, slightly lower admin fees
• HESTA: standout ESG credentials, strong member advocacy

Your choice may come down to values, with HESTA appealing to ethically-minded investors and Aware providing more flexibility for active super members.