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Some of the top-rated home loans in October 2023
The decision by the Reserve Bank of Australia (RBA) to keep the nation’s cash rate on hold this month may have come as a relief to Australia’s first home buyers and other owner occupiers. But with the possibility that rate could rise again before the year’s end, and with no rate cuts expected until mid to late 2024, it’s important for borrowers to carefully consider their mortgage options before making an application, to make sure it suits their finances.
While three of Australia’s Big Four banks believe that the cash rate has already peaked, NAB is still predicting that the RBA will hike the cash rate one more time this year in November 2023, following the release of quarterly inflation figures at the end of October 2023, which may be driven upwards by higher petrol prices.
Looking further ahead, the first rate cuts could be made as soon as May 2024, or perhaps later in that year. This could potentially provide some relief for borrowers in mortgage stress.
Whether you already own your home or are buying your first property, it’s important to compare home loans from across the market to make sure your mortgage suits your financial situation and personal goals. To help simplify this process, you can look at our Home Loan Leaderboards, which rank mortgage deals in different categories by their Real Time Ratings™. These scores out of five are generated based on a loan’s cost and flexibility and are updated daily to ensure they more accurately reflect each loan’s overall value.
Some of the top-rated variable home loans
With the cash rate forecast to be cut in the future, provided inflation falls into the RBA’s target band, there’s a chance that borrowers may be able to enjoy lower repayments in the future, or the opportunity to put more money towards building the equity in their property.
That said, whatever the RBA does with the cash rate, banks and mortgage lenders may still choose to raise or lower their interest rates out of cycle from the RBA. Additionally, when your lender lowers the variable rate on your home loan, that doesn’t always mean your repayment will automatically lower too – you may need to contact the lender and ask them to update your repayments to reflect the lower interest rate.
Some of the top-rated fixed rate home loans
Another mortgage option to consider would be locking in your home loan interest rate for one or more years. This may help to keep your repayments consistent, so whether or not the lender raises or lowers their variable rates, you’ll always be budgeting the same amount for your home loan during the fixed term.
Just keep in mind that you could potentially miss out on savings if your lender lowers its variable rates during your fixed term, and refinancing to a lower rate during this time could mean paying hefty break fees. Also, some fixed rate home loans may not offer as many flexible features and benefits as their variable rate counterparts – always compare the available options.
Some of the best home loans from large banks
While Australia’s Big Four banks often receive a lot of focus, they are far from the only game in town. If you want the confidence of getting your home loan with a major financial institution, there are alternative lenders available that may also be able to offer competitive interest rates, plus special offers such as cashback deals.
Compare home loans in Australia
Product database updated 02 May, 2024
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