November 24, 2022
  • November 24, 2022

Big Bank cuts rates to new lows, refinancing increases

By on September 30, 2021 0


The issue of housing affordability and concerns about household debt are once again dominating the real estate headlines, but if you’re interested in the latest developments in the mortgage world, you’ve come to the right place. place.

There have been a slew of mortgage rate cuts in recent weeks, including a new fixed rate which is the lowest on our database ever. At the same time, borrowers continue to benefit from historically low rates, with refinancing volumes reaching new highs.

So, for an overview of recent home loan rate changes and a look at the lowest and middle rates in the Mozo database, read on.

Recent movements in variable and fixed rates

The steady stream of variable rate cuts has continued in recent weeks, adding to a trend that has seen the average variable rate in the Mozo database (owner-occupied,

  • Big Bank 20 bp cut of sound Advantageous rate loan, which means that the lowest rate is now 2.19% per annum (comparison rate of 2.21% per annum *) for owner-occupants with an LVR
  • Macquarie withdrew 15 bp from its Basic home loan, putting the lowest rate available at 2.24% per annum (comparison rate of 2.24% per annum *) for owner-occupants with an LVR
  • Pacific Mortgage Group cut 10bp of sound Standard variable mortgage, which means that the lowest rate available for owner occupiers with an LVR

Moving on to fixed rates, it’s hard to look past another Big Bank cut. Last month, the bank cut interest rates on a number of its fixed home loans to just 1.59%. For example, the 2-year fixed rate available on the Real estate loan at good rate at reduced price (

  • UBank reduced the 3-year fixed rate for owner-occupiers (UHomeLoan (Fixed) from 10 bp to 1.85% per year (comparison rate of 2.24% per year *) which is currently the lowest in our database for this term of office

The lowest mortgage rates

So how do all of these recent movements compare more broadly? Here’s a look at the lowest mortgage rates currently tracked in the Mozo database available to homeowners (P&I repayments,

Lowest variable rates – Mozo database (October 1, 2021) ^^

Lowest and Average Fixed Rates – Mozo Database (October 1, 2021) ^^

Term Leader rate Fixed rate Mozo average
1 year Big Bank 1.59% pa (comparison rate of 2.15% pa *) 2.28%
2 years Big Bank 1.59% pa (2.10% pa comparison rate *) 2.23%
3 years UBank 1.85% pa (comparison rate of 2.24% pa *) 2.34%
Four years Mutual Bank for Teachers 2.14% pa (comparison rate of 2.90% pa *) 2.59%
5 years Freedom loan 2.47% pa (comparison rate of 2.14% pa *) 2.81%

Borrowers rush to refinance

Given the current low mortgage rates, it’s hardly surprising that many existing borrowers are taking the opportunity to refinance their home loans.

The latest figures released by the Australian Bureau of Statistics show that more than $ 17 billion in loans were refinanced in just one month in July, which was a “historic high”.

“The value of refinancing between lenders was 60% higher in July 2021 than a year ago. This reflected borrowers looking for lower interest rates, especially for fixed rate loans, and repayment agreements with a large number of major and secondary lenders, ”said Katherine Keenan, head of finance and the wealth of ABS.

As Keenan said, low interest rates aren’t the only feature that makes mortgage holders change. The number of lenders offering cash back offers to refinancers continues to grow, as the latest Mozo database tally reveals that there are now 27 lenders with cash back incentives of $ 1,500 or more.

RELATED: More and more mortgage lenders are offering repayment deals, but are they worth it?

Time to take advantage of the low interest rates on offer right now? Whether you’re taking out your first mortgage or looking to refinance an existing loan, make our handy mortgage comparison charts your first stop.

^^ Interest rates are based on a homeowner repaying principal and interest on a loan of $ 400,000 with an LVR of 80%. For more information on average mortgage rates, see our dedicated Australian home loan statistics page.

* CAUTION: This comparison rate only applies to the example (s) given. Different amounts and terms will result in different comparison rates. Costs such as redemption or prepayment charges, 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 that of a guaranteed loan with monthly repayment of principal and interest of $ 150,000 over 25 years.

** The initial monthly repayment figures are only estimates, based on the advertised rate, the loan amount and the foreclosed term. The rates, fees and charges and therefore the total cost of the loan can vary depending on the amount of your loan, the length of your loan and your credit history. Actual repayments will depend on your personal circumstances and changes in interest rates.

^ See information on the Mozo Experts Choice Home Loan Awards

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