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CBA slices new customer variable rates as fixed rates continue to climb
CBA has turned up the heat on competition in the variable mortgage market by slicing rates, yet again, in a bid to win new business.
Australia’s biggest bank has today shaved the rate on its basic home loan by 0.07 percentage points to 4.62 per cent for owner-occupiers paying principal and interest. This rate, however, is only for new CBA customers with own at least 30 per cent of their home.
The move comes two days after rival, ANZ, cut its lowest rate to 4.59 per cent and around two weeks after CBA slashed the advertised rates on its package home loan.
Today’s changes – CBA Extra Home Loan
for owner occupiers paying principal and interest
| LVR | Old rate | New rate | Change % points |
| 70% or below | 4.69% | 4.62% | -0.07% |
| 70.01% to 80% | 4.79% | 4.72% | -0.07% |
| 80.01% to 95% | 5.64% | 5.44% | -0.20% |
Source: RateCity.com.au.
CBA and ANZ are not the only lenders cutting variable rates for new customers.
RateCity.com.au analysis shows since the RBA hikes began in May, 38 lenders have discounted their lowest variable rates for new business.
Other lenders to cut new customer variable rates in the last two weeks include ING, AMP and Bank of Queensland.
CBA and NAB fixed rate changes today
As banks rush to discount variable new customer rates, fixed rates, by and large, continue to climb.
Australia’s biggest bank, CBA, has today made sweeping changes to its fixed rates for both owner-occupiers and investors, the majority of which were increases. CBA has, however, cut its 3- and 5-year fixed rates for owner-occupiers paying principal and interest.
Meanwhile Australia’s third largest home loan lender, NAB, also hiked fixed rates on its 1- and 2-year terms by up to 0.30 percentage points.
CBA fixed rate changes
For owner occupiers paying principal and interest
| Loan term | Old rate | New rate | Change % points |
| 1-yr fixed | 5.39% | 5.44% | +0.05% |
| 2-yr fixed | 5.79% | 5.99% | +0.20% |
| 3-yr fixed | 5.99% | 5.69% | -0.30% |
| 4-yr fixed | 5.49% | 6.09% | +0.60% |
| 5 yr-fixed | 6.69% | 6.49% | -0.20% |
Source: RateCity.com.au. Rates are for owner-occupiers paying principal and interest on a package rate.
NAB fixed rate changes today
For owner occupiers paying principal and interest
| Loan term | Old rate | New rate | Change % points |
| 1-yr fixed | 5.29% | 5.59% | +0.30% |
| 2-yr fixed | 5.89% | 6.09% | +0.20% |
Source: RateCity.com.au. Rates are for owner-occupiers paying principal and interest on a package rate.
Market analysis: number of lenders that have changed at least one fixed rate in the last month
| Loan term | Lenders that have cut | Lenders that have hiked |
| 1-year fixed | 1 | 33 |
| 2-year fixed | 2 | 32 |
| 3-year fixed | 9 | 22 |
| 4-year fixed | 1 | 10 |
| 5-year-fixed | 2 | 14 |
Source: RateCity.com.au. Changes include owner-occupiers and investors.
RateCity.com.au research director, Sally Tindall, said: “The cash rate might be on the rise, but banks are still tripping over themselves to hand out discounts to refinancers willing to turn their back on their current bank.”
“This new customer rate cut from CBA comes hot on the heels of a similar move by ANZ earlier in the week, as the banks jostle for market share,” she said.
“This kind of competition is fantastic for proactive borrowers willing to throw their weight around. If you’re an owner-occupier with a decent amount of equity in your loan, you are a valuable asset to the bank. Use this to get a better deal.
“Remember, the squeaky wheel gets the grease.
“While CBA has hiked the majority of its fixed rates today, the bank has cut its 3- and 5-year rates for owner-occupiers paying principal and interest.
“CBA’s lowest 3-year fixed rate is now half a percentage point below its closest big bank rival, however, it is still half a percentage point higher than the market leader.
“Fixed rates continue to remain a mad gamble, with little clarity on exactly how high the cash rate will go.
“If you do decide fixing is right for you, focus on what’s in your control, which is finding a competitive rate.
“For anyone wanting to hedge their bets, a split loan can be a good way to have a foot in both camps,” she said.
Big four bank lowest rates
| Loan type | CBA | Westpac | NAB | ANZ |
| 1-yr fixed | 5.44% | 5.34% | 5.59% | 5.49% |
| 2-yr fixed | 5.99% | 5.89% | 6.09% | 5.79% |
| 3-yr fixed | 5.69% | 6.19% | 6.34% | 6.19% |
| 4-yr fixed | 6.09% | 5.64% | 6.59% | 6.29% |
| 5-yr fixed | 6.49% | 6.49% | 6.69% | 6.39% |
| Basic variable | 4.62% | 4.49% for 2 yrs then 4.89% | 4.74% | 4.59% |
Source RateCity.com.au. Rates are for owner-occupiers paying principal and interest. LVR requirements may apply.
Lowest variable rates on RateCity.com.au
From lenders that have announced November RBA hikes
| Lender | Advertised rate | LVR required |
| Bank First | 4.19% | 60% or less |
| Auswide Bank | 4.21% | 75% or less |
| Hume Bank | 4.24% | 60% or less |
Source RateCity.com.au. Rates are for owner-occupiers paying principal and interest.
Lowest fixed home loan rates on RateCity.com.au
| Rate type | Lender | Rate |
| 1-year fixed | Bank Australia | 4.64% |
| 2-year fixed | IMB Bank | 5.19% |
| 3-year fixed | Police Bank | 5.19% |
| 4-year fixed | IMB Bank | 5.39% |
| 5-year fixed | HSBC | 5.49% |
Source RateCity.com.au. Rates are for owner-occupiers paying principal and interest. LVR requirements may apply.
Disclaimer
This article is over two years old, last updated on December 2, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent home loans articles.
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