Commonwealth Bank and ING change mortgage interest rates



Borrowers are poised for an interest rate reshuffle today, as two banks have decided to cut variable rates on home loans for new customers while increasing some fixed rates.

One of Australia’s biggest banks and ING are changing mortgage rates. Image Title: Vitalii Taïrov.

Commonwealth Bank home loan is changing

On Friday, for the first time since September 2020, the Commonwealth Bank cut interest rates on its variable home loans by up to 0.40 percentage point, with the biggest cuts going to new borrowers with larger deposits of ‘at least 30% of the value of a property.

The bank also increased most fixed rates by 0.10 percentage points, except for its shorter one-year fixed rates, which were cut by up to 0.20 percentage points.

The changes bring its Variable Rate Extra Housing Loan to 2.29% (2.30% comparison rate) for new borrowers with a loan-to-value ratio (LVR) of 70% and principal and interest repayments. Borrowers with an LVR of 80% would pay 2.39% (comparison rate of 2.40%) on the same loan after the cuts.

CBA’s one-year lump sum loan was reduced by 0.10 percentage points, to 1.99% (comparison rate of 4.10%) for homeowners paying principal and interest.

ING’s real estate loan is evolving

ING has reduced its variable interest rates for new homeowners and investor borrowers by up to 0.25 percentage points for those paying principal and interest.

The changes bring ING’s Orange Advantage variable rate home loan with a 2.29% clearing account feature (2.64% comparison rate) for homeowners with loans over $ 150,000 and a LVR of 80% or less.

ING also increased most fixed rates for homeowners by 0.05 to 0.20 percentage points, but left all fixed one-year mortgage rates unchanged.

The bank’s new two-year fixed rate for homeowners paying principal and interest with an LVR of 80% is 1.99% (comparison rate 3.75%).

How do CBA and ING mortgage rates compare?

The list below shows the cheapest homeowner mortgage rates available for both variable and fixed mortgage loans right now, according to Canstar’s database.

The average variable rate is 3.10%, for homeowners paying principal and interest on a loan of $ 500,000 and 80% LVR.

It might pay off for borrowers to compare home loans, to see if they could get a better deal on their mortgage.

The lowest mortgage rates in the Canstar database

  • Variable: 1.77% (comparison rate 1.86%), Super Saver variable credit reduction of mortgage loans to 60%, maximum LVR of 60%
  • 1 year fixed: 1.59% (compare rate of 2.15%), Great Bank’s Great Rate Discount Fixed 1 year $ 150k + loan, maximum LVR of 80%
  • 2 years fixed: 1.59% (2.10% comparison rate), Great Bank’s Great Rate Discount Fixed 2 years $ 150,000 + loan, maximum LVR of 80%
  • 3 years fixed: 1.79% (compare rate of 3.12%), Community First Credit Union’s Accelerator Package Fixed P&I 3 years Special Offer Loan, maximum LVR of 80%
  • 4 years fixed: 2.15% (comparison rate of 2.90%), Illawarra Credit Union’s The Works Package Home Loan Fixed P&I 4 years Special Offer Loan, maximum LVR of 95%
  • 5 years fixed: 2.27% (2.05% compare rate), Freedom Lend’s Freedom Fixed PI 5 years 70%, maximum LVR of 70%

Source: – October 15, 2021. Based on Homeowner Home Loans on Canstar database, available for loan amount of $ 500,000, all LVR repayments and principal and interest; excluding introductory and first purchase loans only. Maximum rate selected based on the lowest interest rate, followed by the comparison rate. The comparison rate is calculated on the basis of a loan amount of $ 150,000 and a loan term of 25 years. Read the compare rate disclaimer.

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