Lowest home loan rate ever recorded could save switchers $9,500: Greater Bank cuts rates

Senior News Journalist · 21 September 2021
Greater Bank takes out the top spot with the cheapest mortgage rate ever recorded on Canstar’s database, after making some cuts today. Customers will need to lock in their rate for either one or two years to secure the offer.
Greater Bank record home loan rate
Greater Bank has cut rates to record lows. Image: fizkes/Shutterstock.com.

Greater Bank has cut its one and two-year fixed rate home loans for owner-occupiers by 0.10 percentage points and 0.20 percentage points respectively, making the new rates the lowest ever recorded on Canstar’s database across fixed and variable mortgages.

The lender will now offer a handful of one-year and two-year fixed rates at 1.59% (comparison rates from 2.15% and 2.10% respectively), for owner-occupiers with a deposit of at least 20% making principal and interest repayments.

Canstar’s analysis shows if an owner-occupier customer switched from the average variable rate on our database to the Greater Bank two-year fixed rate, they could potentially save more than $9,570* in monthly repayments over those two years, excluding the impact of any fees.

Greater Bank’s low rates will be available on standard home loans as well as those with offset accounts, which are those that have a transaction account linked to the mortgage that can help reduce the interest you pay.

The rates will revert to higher variable rate loans after the fixed period, which is worth keeping in mind when the time comes to compare again at the end of the one or two-year term, if you don’t want to let the loan roll over to the more expensive rate. For instance, the Great Rate Discount Fixed 1 yr $150k+ loan would revert to 2.19% after one year.

Greater Bank is also reducing interest-only home loan rates for one and two-year fixed loans, which makes them only 0.10 percentage points more expensive than the principal and interest loans.

Lowest variable and fixed home loan rates on Canstar’s database

  • Variable: 1.77% (1.86% comparison rate) from Reduce Home Loans, LVRs up to 60%
  • One-year fixed: 1.59% (3.48% comparison rate) from Greater Bank, LVRs up to 95%^
  • Two-year fixed: 1.59% (3.31% comparison rate) from Greater Bank, LVRs up to 95%^
  • Three year fixed: 1.85% (2.24% comparison rate) from UBank, LVRs up to 80%
  • Four year fixed: 2.14% (3.04% comparison rate) from Teachers Mutual Bank and its subsidiaries, LVRs up to 80-90%
  • Five year fixed: 2.27% (2.05% comparison rate) from Freedom Lend, LVRs up to 70%

Source: www.canstar.com.au – 21 September, 2021. Based on owner-occupier home loans on Canstar’s database, available for a $500,000 loan amount, at any LVR and with principal & interest repayments; excluding first home buyer-only loans. Top rate in each category selected based on the loan with the lowest rate, followed by the highest max LVR, followed by the lowest comparison rate. ^Greater Bank rate of 1.59% also available with a discounted revert rate (and therefore lower comparison rate) for LVRs up to 90%.

*Based on owner-occupier loans in Canstar’s database, available for a loan amount of $500,000, 80% LVR and principal & interest repayments; excluding first home buyer-only and introductory loans. Monthly repayment calculations assume a total loan period of 30 years.

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This content was reviewed by Sub Editor Tom Letts and Digital Editor Amanda Horswill as part of our fact-checking process.

Ellie McLachlan is responsible for leading and breaking financial news on mortgages, money and much more. Ellie studied a Bachelor of Journalism and Arts at UQ and has worked at major metropolitan and regional news organisations.

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