Macquarie cuts variable mortgage rates: How it compares to the Big 4

Macquarie Bank lowered advertised interest rates on the majority of its variable home loans by five basis points on Friday. 

Owner-occupiers and investors seeking to purchase or refinance could be set to benefit from the change to the popular lender's basic and offset mortgage products, but existing borrowers won't realise the cut.

Macquarie Bank looks to be a hit among Australian home loan borrowers in recent times, with its home loan book growing by $3.2 billion in July, according to the latest APRA figures.

That represents nearly 40% of the growth realised by the Australian mortgage market that month.

CommBank, NAB, Westpac, and ANZ each recorded mortgage book growth of between $422 million and approximately $2.2 billion in July.

The change also comes after the not-quite-big-four bank threw shade at peers taking their time to pass RBA rate cuts onto mortgage holders.

Macquarie Bank passed the August cut on to variable rate mortgage holders within three days, while the big four banks took between 10 days and two weeks.

"We've been shaking up competition in the Australian banking sector for more than a decade," Macquarie head of personal banking Ben Perham said at the time.

"I think customers agree that a shakeup is well overdue and recognise that we're doing banking differently."

Borrowers may now weigh whether Macquarie's latest cut is enough to lure them from competitors.

Macquarie Bank's new variable mortgage rates for owner-occupiers

Following Friday's rate cut, the major's advertised variable rates now start at 5.34% p.a. (5.36% p.a. comparison rate*) for owner-occupiers with loan-to-value ratios (LVRs) of 70% or less.

That rate is offered on both the bank's basic home loan product and its offset home loan product, with the latter demanding fees of $248 a year and therefore carrying higher comparison rates.

Here's a breakdown of the latest variable rate changes revealed by Macquarie Bank:

LVR	Change	New rate	Basic Home Loan comp rate*	Offset Home Loan comp rate*
<70%	-5bp	5.34%	5.36%	5.60%
<80%	-5bp	5.39%	5.41%	5.65%
<90%	-5bp	5.59%	5.61%	5.84%
<95%	-5bp	6.39%	6.41%	6.64%

Macquarie Bank's new variable mortgage rates for investors

Property investors looking for a new home loan might also find their attention drawn to Macquarie's newly dropped variable rates.

However, interest only mortgages and investor loans with LVRs between 60% and 70% did not see a rate cut on Friday.

Here are the changes posed to property investors:

LVR	Change	New rate	Basic Home Loan comp rate*	Offset Home Loan comp rate*
<60%	-5bp	5.44%	5.46%	5.70%
<80%	-5bp	5.54%	5.56%	5.79%
<90%	-5bp	6.40%	6.42%	6.65%

How do Macquarie Bank's new variable rates stack up?

While Macquarie's new variable rates are some way from the lowest in YourMortgage.com.au's database – currently 4.89% p.a. (4.94% p.a. comparison rate*), a limited time offer on Easy Street's Street Smart Home Loan – they do compare favourably to those advertised by other majors:

Bank	Lowest-rate product	Lowest advertised variable rate	Comp rate*
CommBank	Digi Home Loan	5.34%	5.47%
NAB	Base Variable Rate Home Loan	5.69%	5.73%
Westpac	Flexi First Option (refinancing special)	5.34%	5.35%
ANZ	ANZ Plus home loan	5.50%	5.51%
Macquarie Bank	Basic Variable	5.34%	5.36%

It's worth noting, the lowest variable rate advertised by both Westpac and ANZ is available exclusively to direct-to-bank refinancers, and CommBank's is also only available via the bank's platforms.

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