Bigger and better home loan deals await borrowers as many lenders offer great fixed term and variable deals within the guidelines of the Australian Prudential Regulation Authority (APRA).

Borrowing rates have slipped under four per cent for owner-occupiers. The top three-year fixed rates are now at 3.69 per cent, which translates to a monthly savings of $350 on a $1 million loan, according to research house Canstar. The best variable loans are at a 3.44 per cent rate, compared with the average rate of 4.44 per cent. This could mean $400 in monthly savings for a $1 million loan.

Last December 2014, the APRA imposed a 10 per cent speed limit on annual investment growth. Lenders who have stayed within these guidelines are using what remains of their quota to offer better terms and bigger discounts than their competitors who are exceeding the limit and are unwilling to clamp down on their current offerings.

According to an analysis by consultancy firm Digital Finance Analytics, the average discount on investment loans rose from 15 basis points to 36 basis points between March and May. That compares with 27 per cent growth in discounts for owner-occupied refinance.

One lender taking advantage of these guidelines is the Gateway Credit Union, which is offering a calculation of tax rental income. Another is Westpac, which is lowering the size of deposits required from property investors to 90 per cent from 80 per cent.

Other big banks are also set to announce similar deals in order to remain competitive and grab market share.