Home loan cashback deals for December 2021

The days of the rock bottom interest rate may be coming to an end, as the last of the big four bank home loans offering a rate below 2% have now been hiked. So, what can homeowners do to ensure their home loan stays competitive? It may be worth considering a cashback offer.

The big four banks are walking side by side as they continue to lift fixed interest rates out-of-cycle to the Reserve Bank of Australia’s cash rate, which has sat at its historic low of 0.10% since November 2020.

This week, NAB lifted fixed rates for the third time in just over five weeks, and only days ago CommBank hiked its fixed rate for the third time in six weeks. This action came days after Westpac lifted its last fixed rate starting with a ‘1’, its fourth hike in five weeks.

Mortgage lenders across Australia are starting to factor in the likelihood of interest rate hikes within the next few years - potentially as early as next year.

With many fixed rate loans below 2% vanishing, if you’re shopping around for your first home loan or considering refinancing, you may want to consider other options to ensure the loan is competitive.

Let’s explore some of the cashback offers available to new and refinancing home loan customers for December 2021, including waived lender’s mortgage insurance and Qantas frequent flyer points.

What deals are on offer this month?

• Cashback deals

Cashback deals can range between $1,000 - $5,000, depending on the lender and the size of your mortgage. According to RateCity’s database, in December, 24 lenders are offering cashback deals, with a majority for refinancers only. Four cashback home loans are available for first home buyers.

Cashback deals may be able to cover some of the costs associated with refinancing, such as application fees, or be put towards the new home through a big-ticket purchase, like a new dishwasher.

• Reduced LMI

You may be wondering what else is available that can help first home buyers? Bank of Queensland and St. George are offering their customers a reduced LMI deal (as well as the traditional lump-sum cashback).

If your deposit is smaller than 20%, you will need to pay LMI, which can climb into the tens of thousands of dollars range, depending on your property location. And for those buying in capital cities, a deposit of this size is very difficult to achieve, making LMI a costly inevitability.

Waiving this cost for first home buyers may help to reduce the financial stress of saving for a first property.

• For St. George customers, the offer of $1 LMI is available to eligible first home buyers with a 15% deposit, looking for an owner-occupier home loan, and planning on making principal and interest repayments.
• For BOQ customers, the $1 LMI offer is available to both owner-occupier and investor first home buyers planning on making principal and interest repayments. Approval is limited to deposits as little as 15% on eligible home loans valued up to $1 million.

• Qantas frequent flyer points

You may be able to earn bonus Qantas frequent flyer points when you sign up for a home loan.

Macquarie Bank and Qudos Bank currently offer a home loan sign-up deal that rewards borrowers with Qantas Points. These points may be available at the time of approval or released over your loan term. Plus, you won’t need to spend on eligible purchases to earn these reward points bonuses.

Source: RateCity.com.au. Data accurate as of 03/12/2021.

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