- With the cash rate set to remain at 0.1%, home loan rates as low as 1.79% are available
- Banks are offering sub-2% interest rates on new loans, with various conditions
- Meanwhile, Westpac has also announced reductions to its SME loans to business
With the official cash rate likely to remain at 0.1% for well into 2022 and perhaps 2023 and beyond, Australian retail banks are becoming comfortable with offering ever-lower lending rates.
Westpac is the latest bank to announce a reduction on its fixed interest rate for home lending, offering a 1.79% rate for a two-year fixed owner-occupier loan, under certain conditions.
The bank’s headline rate for a new two-year fixed owner-occupier comes with principal and interest repayments and a $395 annual fee for loans over $150,000 in their ‘Premier Advantage’ package.
A quick look around rival banks sees Greater Bank still offering Australia’s lowest rate of 1.69%, one year fixed, for owner-occupiers, principal and interest.
UBank offers a 1.75% rate, three years fixed, for owner-occupiers paying principal and interest, which they call their “lowest ever advertised rate.” UBank claims there are no ongoing fees, and annual fees, with a $395 “rate lock” fee waived if loans settle on or before 31 March 2021.
Meanwhile, P&N Bank offers a 1.99% fixed interest rate home loan, with flexible repayment options during the fixed term.
CommBank is also advertising a headline 1.99% interest rate home loan, on four years fixed for owner-occupiers with their ‘Wealth Package’. This is for a minimum of $150,000 loans with no establishment or monthly fees.
The list above is not a comprehensive list, so if you are looking for a new home loan, then the advice is to do thorough research, look at all the fine print, and perhaps use a professional mortgage adviser to assist you.
For example, to access Westpac’s super-low rate, you will need a loan to value (LVR) ratio of less than 70%, which means you would have to put up at least 30% as a deposit.
SME Loans
Meanwhile, Westpac has announced interest rate reductions on its SME (small and medium enterprises) business loans under the federal government’s SME Guarantee Scheme.
A 3-year unsecured fixed loan’s interest rate has been reduced from 4.48% to 3.99% per annum, effective 1 March 2021. Three or five-year secured variable loans are available from 2.99%, and fully secured fixed and full drawn loans from 2.38%.
“It’s pleasing to see such positive indicators the economy is starting to recover, and there’s a clear opportunity for some businesses that may be in a position to invest for future growth, which many are telling us they are looking to do.
“We also know that some customers are still impacted and having a difficult time, and we continue to work with them and provide support through our hardship program.”
Guil Lima, Chief Executive of Westpac’s Business division
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