Fixed home loan moves: CommBank hikes and Westpac now the cheapest

Commonwealth Bank has changed home loan interest rates. Image: Vitalii Tairov/Canstar.

Australia’s largest bank is hiking two and four-year fixed home loan interest rates, continuing the trend of rising rates for borrowers who choose to lock in.

Commonwealth Bank increased some fixed home loan interest rates by 0.05 percentage points on Tuesday, applicable to customers who switch to the rates, not existing customers.

CBA’s move aligns with the trend of increasing fixed rates elsewhere. Our analysts found 36% of lenders on Canstar’s database have increased at least one fixed rate in the past two months.

What are the new interest rates?

The new Commonwealth Bank home loan rates for owner-occupiers who pay principal and interest are as follows:

Two-year fixed: 2.14% (4.26% comparison rate)
Four-year fixed: 2.44% (3.99% comparison rate)
Two-year fixed package rate: 1.99% (3.94% comparison rate)
Four-year fixed package rate: 2.29% (3.76% comparison rate)

Lowest fixed rates from the major banks

According to Canstar’s database, Westpac has the cheapest fixed mortgage rates out of the majors at the moment, only tied in one term with National Australia Bank.

CBA’s cheapest fixed rates are more expensive than Westpac’s, NAB’s and ANZ’s for three- and five-year fixed terms.

Out of each of the major banks’ cheapest fixed rates, these are the lowest rates currently available for each term:

One-year fixed: 1.99% (3.50% comparison rate) from Westpac, 70% maximum loan-to-value ratio (LVR)
Two-year fixed: 1.89% (3.38% comparison rate) from Westpac, 70% maximum LVR
Three-year fixed: 1.98% (3.30% comparison rate) from Westpac, 70% maximum LVR
Four-year fixed: 2.19% (3.28% comparison rate) from Westpac, 70% maximum LVR
Five-year fixed: 2.49% from NAB and Westpac (3.76% and 3.33% comparison rates), NAB’s maximum LVR is 95% and Westpac’s is 70%

Source: www.canstar.com.au – 10 August, 2021. Based on owner-occupier loans on Canstar’s database from the major banks, available for a loan amount of $500,000, any LVR (with the maximum LVR each providers’ rates are available for noted) and principal and interest repayments; excludes first home buyer only loans. Comparison rate calculated based on a loan amount of $150,000 and loan term of 25 years.

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

Ellie McLachlan

Former Content Lead

Ellie McLachlan is the former Content Lead at Canstar, helping to shape and deliver the content strategy. She specialises in covering mortgage and everday money topics and breaking finance news. An experienced journalist, Ellie has made her mark working in digital, broadcast and print media, serving in positions such as Editor at News Corp Australia's Compare Money and also News.com.au's Best Of Money, as Story Strategy Coach at the Australian Conservation Foundation, as a lifestyle reporter at The Urban List, The Courier Mail and The Sunshine Coast Daily, as well as radio presenter at 4ZZZ. While at Canstar, Ellie has written well over 500 finance articles and her work is regularly referenced by other publishers, including Business Insider, The Motley Fool and The New Daily. Her expert financial commentary has been featured in publications such as Yahoo Finance and the Herald Sun. Ellie studied a Bachelor of Journalism and Arts (Peace and Conflict Studies) at the University of Queensland. Follow Ellie on LinkedIn, Twitter, and Canstar on Facebook. Meet the Canstar Editorial Team.

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