Award-winning lenders for first home buyers revealed

At a time of rising interest rates, which banks and customer-owned financial institutions are offering outstanding value to those looking to buy their first home? Canstar reveals the winners of its 2022 First Home Buyer Awards.

Following consecutive cash rate increases by the Reserve Bank of Australia (RBA) in May, June and July of this year, interest rates for borrowers have risen steeply. The days of rates starting with a one are gone for now and mortgage holders are living with the new normal of higher repayments, and probably even higher ones to come.

Existing borrowers have felt the impact but first home buyers have been affected too, with rising borrowing costs generally meaning a drop in borrowing power.

In this more challenging environment, it’s become all the more important for first home buyers to choose a loan provider carefully to ensure they’re getting value for money. Canstar’s latest First Home Buyer Award results could be a helpful guide for borrowers. They show which bank came out on top nationally and which customer-owned institutions scored highest in different parts of the country when it comes to the products and services they offer to first home buyers.

the country when it comes to the products and services they offer to first home buyers.

At a glance:

Numbers crunched:
- 104 providers assessed
- 677 products considered
Award winners:
- Bank of the Year (national): Westpac
- Customer-Owned Bank of the Year – New South Wales, Queensland, Victoria & Western Australia: Teachers Mutual Group (including Teachers Mutual Bank, UniBank, Firefighters Mutual Bank and Health Professionals Bank)
- Customer-Owned Institution of the Year – Northern Territory: People’s Choice
- Customer-Owned Institution of the Year – South Australia: Credit Union SA
- Customer-Owned Bank of the Year – Tasmania: Bank of Us

How were the winners decided?

For the First Home Buyer Awards, each eligible provider on Canstar’s database was assessed based on its offerings to customers in five categories:

Planning for your first home (5%): How does the institution support consumers during the planning stages of buying their first home? For example, does it provide budgeting tools, access to property research reports and competitive savings accounts to help with building a deposit?
Applying for and settling your first home (15%): How does the institution support consumers in the application and settlement stages of the loan? For example, what are the guarantee and deposit options for borrowers and what channels can they apply through (online, in branch, through a mobile lender etc.)?
Managing your home loan (70%): This category considers the total cost of the loan (variable and fixed rates are considered), the day-to-day management of the loan including making repayments, and the availability and functionality of a redraw facility and offset account.
Assistance on your home loan (5%): How well does the institution support customers over the life of the loan if they need help?
Closing your home loan (5%): This category assesses the ease, cost and speed associated with discharging the loan (e.g if you decide to switch down the line).

The providers’ weighted scores in each category are added together and the providers with the highest scores overall in each of the national and state-based categories wins an award. There is an overall national Bank of the Year Award and separate Customer-Owned Awards for the top provider in different parts of the country.

For more information on how the results were calculated and which institutions were eligible, you can read the methodology.

Bank of the Year – First Home Buyer (National): Westpac

Westpac is the winner of Canstar’s national Bank of the Year – First Home Buyer Award for 2022. The major bank earned consistently strong scores across the various categories considered and was the category leader in several areas.

Canstar Research said the fact that Westpac’s pricing was the same for borrowers with 90% and 80% LVRs played in its favour and made its 90% LVR home loans particularly competitive. Westpac’s savings account interest rates – helping first home buyers save a home deposit faster – also contributed to its win.

On the features and services front, Canstar Research noted that Westpac assists customers by offering property reports, customer service that’s available 12 hours a day, seven days a week and waives the cost of lenders mortgage insurance for borrowers working in eligible professions.

Customer-Owned Bank of the Year – First Home Buyer New South Wales, Queensland, Victoria & Western Australia: Teachers Mutual

Teachers Mutual won this year’s Customer Owned Bank of the Year Award in no fewer than four states, namely New South Wales, Queensland, Victoria and Western Australia.

The group achieved high scores across the board, but in particular stood out from the pack in these states when it came to the price-focussed ‘managing your home loan’ category. Canstar Research said this was down to competitive variable rates, with the same pricing on offer for 80% and 90% LVR loans.

The features on offer to Teachers Mutual customers also contributed to the win, notably the unlimited free redraws that customers can make. Teachers Mutual is also a participant in the federal government’s First Home Guarantee scheme.

Customer-Owned Institution of the Year – First Home Buyer Northern Territory: People’s Choice

In the Northern Territory, People’s Choice won this year’s award thanks to its strong product performance.

Canstar Research said its average variable interest rate over the period assessed for the award placed it above average in the Northern Territory profile. Its fees were also more competitive than other eligible providers in the Territory, according to the analysis.

People’s Choice also achieved high scores in the other categories assessed and was the leader or joint leader in the territory in all areas considered. For borrowers looking for government support, People’s Choice is also a participant in the First Home Guarantee scheme.

Customer-Owned Institution of the Year – First Home Buyer South Australia: Credit Union SA

Credit Union SA is Canstar’s 2022 Customer-Owned Institution of the Year for South Australia. The credit union outscored the other providers considered overall, but particularly on cost, with its competitive variable home loan interest rates available to first home buyers among the factors contributing to the win.

The features attached to its products were also market-leading, according to Canstar Research, and it was one of very few providers to offer redraw functionality and full offset with no account keeping fees.

When it came to service, Canstar Research noted Credit Union SA’s quick home loan discharge turnaround times and the customer support available 12 hours per day from Monday to Friday and six hours on Saturdays, via multiple methods including face-to-face, phone and online chat. It is also a participant in the First Home Guarantee scheme.

Customer-Owned Bank of the Year – First Home Buyer Tasmania: Bank of Us

Tassie-based lender, Bank of Us, won Canstar’s Customer-Owned Bank of the Year Award for 2022 in its home state. Its products and services for first home buyers earned high scores across the board, with Canstar Research noting its low variable interest rates during the assessment period.

On the features and services side, Bank of Us offers a free unlimited redraw facility on eligible loans and a range of tools and calculators to assist first home buyers on their journey. Its customer support is available in-person, over the phone or online.

Bank of Us is another of the participants in the federal government’s First Home Guarantee scheme, as well as the Tasmanian Government’s MyHome initiative which assists eligible home buyers to build or purchase a home to live in.

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Canstar’s Research team provides the expertise that powers our Star Ratings and Awards, designed to help consumers make better-informed financial decisions. As Australia’s biggest financial comparison site, Canstar researches and rates products from more than 775 brands, across more than 30 finance categories. Our expert researchers analyse products we rate by comparing price and features, with the top products being recognised with a 5-Star Rating. Our Star Ratings are made available for consumers to view for free via Canstar’s comparison tables. Providers whose products perform strongly in our Star Ratings may be recognised with an Outstanding Value Award.

→ Discover Canstar’s latest Star Ratings and Award winners

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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.

Sean Callery

Former Deputy Editor

Sean Callery is a former Deputy Editor at Canstar. When at Canstar, he and his team covered just about every finance and lifestyle topic under the sun, from property to budgeting to the nitty-gritty of financial products like home loans, superannuation, and insurance. Sean has written and edited hundreds of finance articles for Canstar and his work has been referenced far and wide by other publications and media outlets, including Yahoo Finance and 9News.

Sean has accumulated more than a decade of international experience in communications roles – in Australia, the UK and Ireland – across finance, banking, consumer and legal affairs, and more. His work as a journalist has featured in various publications and media outlets, including the Drogheda Independent, the Law Society of Scotland Journal and Ireland’s national broadcaster, Raidió Teilifís Éireann. Before joining Canstar, Sean oversaw content at Great Southern Bank (formerly CUA), one of Australia’s biggest member-owned financial institutions. He has a Bachelor’s Degree in Journalism (Dublin City University) and a Masters Degree in Creative Advertising (Edinburgh Napier University).