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HOME loan customers should urgently review their mortgage to benefit from rock-bottom deals as dozens of lenders continue to cut rates, a comparison website says.
Despite the cash rate resting at a record low of 1.5 per cent since August last year, 23 lenders have cut owner occupier variable home loan rates since July 1.
Financial comparison website Mozo’s database shows more than 66 lenders now offer rates below 4 per cent.
The site’s spokeswoman, Kirsty Lamont, said while spring was traditionally the peak time for lenders to move rates, intensified competition had arrived early.
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“The level of competition that we are seeing this year in the lead up to spring is unusually high, we have 23 lenders cutting variable home loan rates over the last two months,’’ she said.
“The top rates are all well below 3.8 per cent these days so there’s no reason to be paying any more than that.”
Mozo’s data shows the big four banks’ average variable rate is 4.64 per cent — 1.2 per cent higher than the lowest variable rate offered by Reduce Home Loans at 3.44 per cent.
By switching to the cheapest rate borrowers with a $300,000 30-year loan, you could save about $75,000 in interest charges over the life of the loan.
Lenders are also wheeling out cashback deals, fee waivers and other incentives to lure in new customers.
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Home Loan Experts managing director Otto Dargan said he expected to see “competition heat up even more for home loans with principal and interest repayments.”
“Every week we’re seeing a new discount come out and no lender stays the cheapest for very long,’’ he said.
“These discounts aren’t for existing customers because the banks don’t want to offer a discount where they don’t have to.”
Mr Dargan said it was unlikely the big banks would match discounted rates from smaller lenders and urged customers to shop around.
The Australian Securities Exchange’s Reserve Bank ratetracker which monitors market expectations of a rate move said on Wednesday there was a zero per cent chance of the cash rate moving next week when the RBA board meets.