Westpac goes 'head-to-head' with ANZ with latest home loan offering: 'Lowest variable rate'
Westpac has gone “head-to-head” with ANZ to match its lowest variable home loan interest rate in a bid to win over new customers. The major bank now offers a new lowest variable rate of 5.84 per cent as the refinancing fight heats up.
Westpac’s new Flexi First Option special rate is only available to customers who apply online directly with the bank. The lowest rate of 5.84 per cent is reserved for owner-occupiers paying principal and interest with a deposit of more than 30 per cent.
The new rate is 0.35 per cent lower than Westpac’s previous lowest variable rate of 6.19 per cent. Its other home loan rates are unchanged, with the bank previously passing on the Reserve Bank of Australia’s (RBA) 0.25 per cent cut to variable homes from March 4.
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Canstar data insights director Sally Tindall said the move meant Westpac now had the equal lowest advertised variable home loan rate out of the Big Four banks, alongside ANZ.
“For months ANZ has had the lowest variable rate among the big four banks with its digital-only home loan, closely followed by CBA. This move sees Westpac leapfrog CBA and leave NAB in the wind,” Tindall said.
“Three of the big four banks are now in a digital arms race, jostling to steal customers from each other but only those customers willing to apply digitally.”
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ANZ’s lowest rate is also available for owner-occupiers refinancing through the ANZ Plus app, with deposits of 20 per cent or more accepted.
CBA’s lowest rate is 5.90 per cent, again as a digital-only home loan. NAB’s lowest rate is 6.19 per cent but customers don’t have to apply online.
Following the RBA’s rate cut, someone with a $600,000 loan with 25 years remaining would have seen their minimum monthly repayments drop by $92.
Refinance market heats up
Tindall said Westpac’s move was a sign the refinance market was “coming back to life”.
“The banks are now laser focused on winning over ‘desirable’ borrowers – those with big deposits and who are willing to switch online,” Tindall said.
The latest Australian Bureau of Statistics data found a total of $206 billion worth of loans were refinanced in 2024, with refinancing rates expected to increase following the RBA’s cut.
