Is the pendulum swinging back on variable rate same day loans?

Over the past few days, UBank, MyState, Bank Australia and Illawarra Credit Union have all cut interest rates on variable rate home same day loans.

The four lenders join Westpac, Bank of Us, Teachers Mutual, Great Southern Bank and Qudos Bank in the chorus of variable rate cuts in recent weeks.

As of March 2020, fixed rate loans accounted for only 13% of the value of new loans, while recent ABS data shows that they are now almost half same day loans

This was part of record interest rates and low-cost Reserve Bank funding provided to banks over a three-year period, which a loan officer said helped fuel the last real estate boom.

On Wednesday, UBank made changes to its two “UHomeLoan” variable rate products for homeowners, with slightly different rates depending on the loan-to-value ratio, or LVR:

  • 80% LVR: Decrease of 15 basis points to 2.19% per year (comparison rate of 2.19% per year *)
  • 85% LVR: Decrease of 15 basis points to 2.34% per year (comparison rate of 2.34% per year *)

In August, UBank also cut variable rates for investors by up to 19 basis points.

UBank is one of the few lenders to forgo Lender Mortgage Insurance (LMI) for borrowers with a 15% deposit, which the NAB-owned company says could save borrowers 5,000 $ in LMI costs on the “average” home loan of $ 480,000.

Bank Australia also cut interest rates on its range of “base” variable rate mortgage products on Thursday. Some of the most notable changes include:

  • Basic 60%: 20 basis points reduction to 2.35% pa (comparison rate of 2.39% pa *)
  • Basic 80%: 20 basis points reduced to 2.50% pa (comparison rate of 2.54% pa *)
  • 60% base inv: 10 basis points reduced to 2.65% pa (comparison rate of 2.69% pa *)
  • 80% base inv: 10 basis points reduced to 2.80% pa (comparison rate of 2.84% pa *)

Bank Australia 80% LVR Homeowner Loan also applies to government guaranteed loans for first time buyers with a 5% down payment.

Monday, MyState Bank also lower rates on various variable rate mortgage loans for investors. Some key changes include:

  • Investment 60%: 10 basis points reduced to 2.44% pa (comparison rate of 2.50% pa *)
  • Investment 80%: 10 basis points reduced to 2.54% pa (comparison rate of 2.60% pa *)

These are special offers, meaning they can be withdrawn at any time.

Meanwhile, Friday Illawarra Credit Union reduced by 75 basis points its owner-occupant variable rate mortgage “The Works Package” for new borrowers paying only interest.

The rate is now 2.50% per year (comparison rate of 3.01% per year *).

“The work package” includes a 100% compensation account, a drawing facility, a credit card and the possibility of dividing the loan between fixed and variable rates.


Buying a home or looking to refinance? The table below shows home loans with some of the lowest interest rates on the market for homeowners.

Lender Rate type Gap Redraw Ongoing charges The initial costs LVR Lump sum reimbursement Additional refunds Pre-approval
Variable More details

Smart Booster real estate loan at variable discount rate – 2 years (LVR

  • Fast turnaround times, can meet a 30 day settlement
  • For purchase and refinancing, minimum deposit of 20%
  • No ongoing or monthly fees, add compensation for 0.10%
Variable More details

Low rate home loan – Premium (principal and interest) (owner occupied) (LVR

  • No upfront or ongoing costs
  • 100% clearing account
  • Additional refunds + reprint services
Variable More details

Nano Home Loans Variable Owner Busy, Principal and Interest (Refinancing Only)

  • Refinancing only. Fast online application
  • No Nano fees. 100% free sub-account clearing
  • Mobile app, Visa debit card and instant payments
Variable More details

Owner Occupant Accelerate – Celebrate (LVR

  • For a chance to win $ 100,000 for your home loan, apply to Athena before October 31 and get approved by December 15
  • We reduce your rate based on the amount you have repaid on your loan
  • Automatic rate matching

Owner Occupant Accelerate – Celebrate (LVR

  • For a chance to win $ 100,000 for your home loan, apply to Athena before October 31 and get approved by December 15
  • We reduce your rate based on the amount you have repaid on your loan
  • Automatic rate matching
Variable More details

Garden mortgage (principal and interest) (special) (LVR

  • Unlimited additional refunds
  • Unlimited free withdrawals
  • Optional 100% compensation can be added for $ 120 per year ^

Image by 3D Animation Production Company on Pixabay

The entire market was not taken into account in the selection of the above products. Instead, a smaller part of the market has been envisioned, which includes the retail products of at least the Big Four Banks, the Top 10 Customer-Owned Institutions and Australia’s largest non-banks:

Products from some vendors may not be available in all states. To be taken into account, the product and the price must be clearly published on the website of the supplier of the product.

In the interest of full disclosure,, Performance Drive, and are part of the Firstmac group of companies. To learn more about how handles potential conflicts of interest, as well as how we are paid, please click on the links on the website.

*Comparison rate is based on a loan of $ 150,000 over 25 years. Please note that the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as draw charges and cost savings such as fee waivers are not included in the comparison rate but may influence the cost of the loan.

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