These lenders are going after the big banks and cutting home loan rates instead
As attention shifts to the RBA’s June meeting next week, small lenders have shown their might by cutting fixed and variable interest rates on home loans.
As competition intensifies in the realm of home loans, a number of mutual banks and credit unions have proven that they are not afraid to stay competitive, reducing both fixed interest rates and variables in home loans for homeowners and investors.
First Community Credit Union
Leading the charge for the little guys was Community First Credit Union, taking the sword at its Principal and Interest Accelerator Package Home Loans with a drop of up to 135 basis points.
For homeowners with a loan-to-value ratio (LVR) of up to 95%, Community First has reduced the variable rate by 125 basis points.
The new price is:
- 2.49% per year (comparative rate of 2.93% per year*)
For investors with an LVR of up to 80%, Community First cut the floating rate by 135 basis points.
The new price is:
- 2.69% per year (comparative rate of 3.13% per year*)
A division of Community First Credit Union, Easy Street has cut its Street Smart variable home loan product for homeowners and investors by 85 basis points.
For homeowners and investors with an LVR of 95%, Easy Street’s Street Smart rates are now:
- Street Smart variable P&I: 2.39% per year (comparative rate of 2.44% per year*)
- Investment Street Smart Variable P&I: 2.39% per year (comparative rate of 2.44% per year*)
The mutual bank has cut interest-only (IO) fixed-rate home loans for homeowners by up to 99 basis points.
Highlights of these declines include:
- Fixed Rate First Buyer 1 Year IO 95%: 99 basis point decline to 2.49% pa (comparative rate 2.39% pa*)
- Fixed Rate 1 Year IO 95%: Decrease of 89 basis points to 2.74% per year (comparative rate of 4.42% per year*)
- Fixed Rate 3 Years IO 95%: Decrease of 24 basis points to 4.19% per year (comparative rate of 4.50% per year*)
- Fixed Rate 5 Years IO 95%: Decrease of 40 basis points to 4.64% per year (comparative rate of 4.63% per year*)
Are you buying a house or looking to refinance? The table below shows home loans with some of the lowest interest rates on the market for homeowners.
- Fast turnaround times, can meet 30 day settlement
- For purchase and refinancing, down payment min 20%
- No ongoing or monthly fees, add 0.10% compensation
Basic criteria: a loan amount of $400,000, variable, fixed, principal and interest (P&I) real estate loans with an LVR (loan-to-value) ratio of at least 80%. However, the “Compare mortgages” table allows calculations to be made on the variables selected and entered by the user. All products will list the LVR with the product and price list which is clearly published on the product supplier’s website. Monthly repayments, once the basic criteria are modified by the user, will be based on the advertised prices of the selected products and determined by the loan amount, repayment type, loan term and LVR as entered by the user. user/you. *The comparison rate is based on a loan of $150,000 over 25 years. Please note: this comparison rate is only true for this example and may not include all fees and charges. Different terms, fees or other loan amounts may result in a different comparison rate. Rates correct as of June 3, 2022. See disclaimer.
Image by Anna Shvets via Pexels
The entire market has not been taken into account in the selection of the products above. Instead, a reduced portion of the market was considered. Products from some vendors may not be available in all states. To be considered, the product and price must be clearly published on the product supplier’s website. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au and Performance Drive are part of the Savings Media group. In the interest of full disclosure, Savings Media Group is associated with Firstmac Group. To learn how Savings Media Group handles potential conflicts of interest, as well as how we are paid, please visit the website links at the bottom of this page.