People looking for a home loan or wanting to switch their home loan have been given a New Year bonus by the Greater Building Society which today announced it is cutting its fixed home loan rates to be as much as 50 basis points (0.50 per cent) below the Big 4 banks.
From Friday (January 30), The Greater’s three year fixed Ultimate (packaged) Home Loan will be 4.44 per cent, half of one per cent lower than the equivalent rate on offer by the major banks.
The Greater’s five year rate of 4.64 per cent is 0.35 per cent better than the Big 4 banks.
The gap between The Greater and the big banks’ rates is even wider when comparison rates are used.
|Fixed Rate Packaged Home Loans||3 yr rate||5 yr rate|
|Greater Building Society (effective Jan 30)||4.44%||4.64%|
CEO Scott Morgan said fixed rates continue to be popular for both residential and investment loans with uncertainty about whether official rates will rise or fall in the longer term. Mr Morgan said people can gain a rate cut from The Greater regardless of whether the Reserve Bank cuts official rates on Tuesday (February 3).
He warned consumers taking out any fixed rate home loans to check the loan features particularly the rate that the loan will revert to once the fixed rate period is over.
“Some financial institutions have high variable rates and some place you on a higher than usual variable rate once your fixed term ends, a practice we call the “revert rate rort”, Mr Morgan said.
“At The Greater, we’re straightforward with our customers so our packaged fixed rate loans revert to the low packaged variable rate,” he said.
Mr Morgan said a customer taking out a $300,000, five year fixed, packaged home loan with The Greater (even paying interest only repayments) will be $5,250 better off than taking such a loan through CBA or another major bank.
The Greater’s packaged (Ultimate) home loan has no establishment fee and includes a fee free transaction account, discounted insurance, a free initial financial planning consultation, and a linked credit card with waived annual fee. Unlike many other financial institutions, The Greater offers a free internet redraw facility on its fixed rate home loans and the ability to make extra repayments.
“The Greater continues to offer people a straightforward alternative to the major banks with great rates, outstanding service, and all the other banking services they need,” he said.
The NSW based Greater offers home loans as well as other banking and financial services to around 250,000 customers in NSW and South East Queensland.