Home News Mutual banks trim variable home loan rates amid rate cut speculation

Mutual banks trim variable home loan rates amid rate cut speculation

Member-owned banks took the lead in slashing variable mortgage rates days after Australia’s inflation rate was revealed to be slower than expected.

By Bernadette Lunas

First published on 31 Jan 2025

Fact Checked

Mutual banks trim variable home loan rates amid rate cut speculation

With both headline and trimmed mean inflation figures undershooting RBA's forecast, the odds that the cash rate will be lowered in February have never been higher.

Following the release of December quarter CPI, NAB and Westpac, which had previously predicted a May start to rate cuts, both flipped and joined Big 4 peers CBA and ANZ in tipping for a 25 basis point cut to the cash rate next month.

"The Q4 CPI confirmed that inflation has moderated more quickly than the RBA expected and sets up a likely downward revision to the inflation profile in the February Statement on Monetary Policy (SMP)," said Alan Oster, NAB Group chief economist.

"This now makes February the most likely starting point for a gradual easing in interest rates."

This is welcome news for mortgage holders eager for relief on their interest rates.

However, it appears most lenders are sitting this week out, delaying any major moves with only a few member-owned institutions making cuts to their variable home loan rates.

MOVE Bank drops home loan rates up to 30 bps

MOVE Bank has made a flurry of cuts across its Everyday Home Loan and Offset Home Loan products for owner-occupiers and investors.

The headline variable rate of 5.94% p.a. (5.99% p.a. *comparison rate) is available through Everyday Home Loan with a maximum loan-to-value ratio (LVR) of 80%.

To qualify for this rate, customers must deposit $1500 into a MOVE Bank transaction account every month.

Meanwhile, borrowers seeking a variable rate mortgage with a 100% offset account can get the lowest rate of 6.14% p.a. (6.19% p.a. *comparison rate) through the bank's Offset Variable Home Loan with up to 80% LVR.

The lowest rates for investment home loan borrowers are 6.09% p.a. (6.14% p.a. *comparison rate) for the Everyday Home Loan P&I, and 6.29% p.a. (6.34% p.a. *comparison rate) for the Investment Offset P&I.

MOVE Bank has also put its fixed mortgages on the chopping block this week, bringing the lowest OO rate down to 5.64% p.a. (5.93% p.a. *comparison rate) available for those fixing for two years.

Qudos Bank cuts variable rates by 10 bps

Sydney-based Qudos Bank slashed the rates on its No Frills variable home loan by 10 basis points.

The No Frills range features the lender's lowest variable rate.

Following this week's adjustments, the lowest rate for owner occupiers is 5.89% p.a. (5.89% p.a. *comparison rate), for principal and interest (P&I) repayments and with a maximum 70% loan-to-value ratio (LVR).

For investors, the lowest rate is 6.09% p.a. (6.09% p.a. * comparison rate), with P&I repayments and up to 70% LVR.

Meanwhile, here are the rates for No Frills home loans with up 80% LVR.

Product	New rate	Comparison rate
No Frills Home Loan P&I	5.99% p.a. (-10 bps)	5.99% p.a.*
No Frills Home Loan IO	6.39% p.a. (-10 bps)	6.16% p.a.*
Investment No Frills Home Loan P&I	6.19% p.a. (-10 bps)	6.19% p.a.
Investment No Frills Home Loan IO	6.44% p.a. (-10 bps)	6.30% p.a.*

Illawarra Credit Union lowers variable home loan rates

Illawarra Credit Union applied up to a 15 basis point cut across its range of variable home loans for both owner-occupiers and investors.

Borrowers seeking a basic variable rate mortgage can now access the lender's lowest rate at 5.94% p.a. (6.04% p.a. *comparison rate).

Meanwhile, Illawarra Credit Union's The Works Package with a linked offset account carries a 6.04% p.a. interest rate (6.48% p.a. *comparison rate).

For investment home loans, the lowest basic variable rate is 6.24% p.a. (6.34% p.a. *comparison rate), and 6.34% p.a. (6.78% p.a. *comparison rate) for its mortgage with 100% offset account.

Image by wirestock on Freepik

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Bernadette Lunas

Bernadette is a journalist with years of experience covering topics in macroeconomics, real estate, and lifestyle beats for notable print media organisations. She joined the InfoChoice Group in 2024, bringing her passion for writing stories that help Australians make better decisions about money.

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Mutual banks trim variable home loan rates amid rate cut speculation

MOVE Bank drops home loan rates up to 30 bps

Qudos Bank cuts variable rates by 10 bps

Illawarra Credit Union lowers variable home loan rates

Ready, Set, Buy!

Bernadette Lunas