ANZ cuts fixed rates: "Ample choice" out there for refinancers

Senior News Journalist · 15 February 2021
Continuing the trend of falling home loan interest rates, ANZ cut its fixed rates today. There is “ample choice” available to borrowers looking for a better rate, and not just from the major banks, according to this expert.
ANZ cut fixed rates Feb 2021
ANZ has cut fixed rate home loans. Have you compared lately? Image source: Vitalli Tairov.

The major bank is cutting its fixed interest rates by 0.05 percentage points across the board for homeowners and investors with a loan-to-value ratio (LVR) of up to 80%, meaning they would essentially require at least a 20% deposit.

The cuts put ANZ’s lowest owner-occupier fixed rate down at 2.04% for either one, two or three-year fixed terms (comparison rates 4.13%, 3.97% and 3.83% respectively).

The lowest fixed investor rates at ANZ are now 2.44% on the two and three-year terms (comparison rates 4.52% and 4.35% respectively).

Comparing the other major banks’ 80% LVR offers, ANZ now has the lowest fixed rates for one, two, three and five-year fixed rate offers.

With a lower maximum LVR at 70% (requiring a 30% deposit), Canstar’s database shows Westpac offers the lowest fixed rate loans of all the major banks across all fixed terms from one to five years, with several of its fixed rates below 2%.

There are even lower rates for homeowners to be found elsewhere at smaller banks, including the lowest rate on Canstar’s database introduced last week by Greater Bank at a rate of 1.69% fixed for one year (3.49% comparison rate).

Canstar finance expert Steve Mickenbecker said today’s cuts by Australia’s fourth-largest lender continued a “deluge” of home loan rate cuts over the last year and sees ANZ’s fixed rates inch closer to the 2% mark.

He said there were currently 120 fixed rates on the database below 2%, providing “ample choice” for people looking to refinance from the average variable rate of 3.29%.

“Average is no longer good enough when the potential savings are so huge,” Mr Mickenbecker said.

“Now is a great time to do a deal with your bank, given the possibility of some of today’s super-low rates edging up when the Reserve Bank’s low-rate term funding facility comes to an end around mid-year.”

The funding has provided a three-year line of credit from the Reserve Bank of Australia (RBA) to banks at an extremely low rate of 0.10% since November, but this is due to expire at the end of June, or sooner if banks fully draw down on the funding before then.

As we’ve explained before, this provides borrowers – particularly those with an existing home loan and whose financial positions have remained stable despite the pandemic – with a “golden opportunity” to secure record-low fixed rates before the banks’ cheap source of funding dries up.

With that in mind, the below list shows the top fixed home loan rates available for homeowners on Canstar’s database at the time of writing.

Top 5 fixed home loan rates on Canstar’s database

Provider Product Interest Rate Comparison Rate Monthly Repayments Maximum LVR Available
Greater Bank Great Rate Fixed 1 yr 1.69% 3.49%  $         1,417.24 95.00%
UBank UHomeLoan Fixed P&I 3 yrs 1.75% 2.22%  $         1,428.97 80.00%
Homestar Finance Star Fixed P&I 2 yrs 150-850k 1.88% 2.26%  $         1,454.59 80.00%
HSBC Home Loan Package Owner Occupier Fixed P&I 2 yrs <80% 1.88% 2.86%  $         1,454.59 80.00%
TicToc Home Loans Live-in Fixed P&I 2 yrs 1.89% 2.15%  $         1,456.57 90.00%

Source: – 15/2/2021. Based on owner-occupier fixed rate home loans on Canstar’s database available for a loan amount of $400,000, at any LVR, with principal and interest repayments. Top 5 selected and table sorted in ascending order by total rate, followed by comparison rate. One product per provider is listed. Monthly repayments based on a 30-year loan term and assumes rates remain the same throughout that time. Comparison rate calculated based on a $150,000 loan amount over a total loan term of 25 years. Read the Comparison Rate Warning.

If you’re currently considering a home loan, the comparison table below displays some of the 1-year fixed rate home loans on our database with links to lenders’ websites that are available for homeowners looking to refinance. This table is sorted by Star Rating (highest to lowest), followed by comparison rate (lowest-highest). Products shown are principal and interest home loans available for a loan amount of $350K in NSW with an LVR of 80% of the property value and that offer an offset account. Before committing to a particular home loan product, check upfront with your lender and read the applicable loan documentation to confirm whether the terms of the loan meet your needs and repayment capacity. Use Canstar’s home loan selector to view a wider range of home loan products.

This article was reviewed by our Sub Editor Tom Letts before it was published, as part of our fact-checking process.

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