If you're in the market for a competitive fixed-rate mortgage, take note: Police Bank is now offering fixed rates as low as 4.99% p.a. – with some slashed by more than a full percentage point on Friday.
That's well below Macquarie Bank's 5.19% p.a. two- and three-year fixed rate, which was the lowest in our database just last week.
The mutual bank, which aims to support Australian police officers, is open to everyone, not just current or former police members.
The new rate is particularly attractive when compared with the average one-three year fixed rate of 5.80% p.a. on new owner-occupier mortgages, according to RBA data for February.
An owner-occupier with a typical mortgage of $666,000 (as of December) could save nearly $340 a month by locking in a 4.99% p.a. fixed rate rather than the 5.80% p.a. average.
That adds up to more than $12,000 in savings over a three-year term.
The 4.99% p.a. fixed rate is available across several loan types for fixed terms of three years, including:
- First Home Loan (for Home Guarantee Scheme participants)
- Goldrate Home Loan
- Police Value Home Loan
- Investment Goldrate Home Loan
Even more appealing, these rates are accessible to eligible borrowers with deposits as low as 5%, or even 2% under the Family Home Guarantee.
First home buyers: 4.99% fixed rate details
Entering the market using the Home Guarantee Scheme? You might be eligible for Police Bank's First Home Loan.
The product is among those to receive fixed rate cuts on Friday, with new rates now starting from 4.99% p.a. (comparison rates* from 5.50% p.a.).
The loan also allows borrowers to split their rate and access an offset account on the variable portion – potentially offering flexibility and interest savings.
It's also available as a construction loan, with interest-only repayments available during the build phase.
Rates on the product are as follows, with those announced on Friday shown in bold:
| Term | LVR | Change | New rate | Comp rate* |
|---|---|---|---|---|
| One year fixed | – | – | 5.89% | 5.69% |
| Two year fixed | 80–98% | –64bp | 5.15% | 5.58% |
| Three year fixed | 80–98% | –60bp | 4.99% | 5.50% |
| Five year fixed | 80–98% | – | 6.69% | 6.14% |
| Variable | 80–98% | – | 5.59% | 5.66% |
Note: This product is exclusive to borrowers using the Home Guarantee Scheme. Those with deposits of 20% or more (LVR <80%) are not eligible for the scheme.
Homeowners and refinancers: 4.99% fixed rate details
Owner-occupiers, first home buyers not using the scheme, and refinancers can access the new rates through Police Bank's Goldrate Home Loan.
This loan allows up to $9,999 in extra repayments per year on fixed terms and offers an interest-only option (note: IO rates may differ).
Updated fixed rates:
| Term | LVR | Change | New rate | Comp rate* |
|---|---|---|---|---|
| Two years fixed | <60% | -34bp | 5.15% | 5.94% |
| 60–80% | -34bp | 5.15% | 5.98% | |
| 80–95% | -34bp | 5.15% | 6.02% | |
| Three years fixed | <60% | -60bp | 4.99% | 5.82% |
| 60–80% | -60bp | 4.99% | 5.86% | |
| 80–95% | -80bp | 4.99% | 5.89% |
Current or retired police officers may also qualify for the Police Value Home Loan, which offers lower variable and fixed rates on select terms than Goldrate – along with more competitive revert and comparison rates.
Property investors: 4.99% fixed rate details
Finally, property investors can also realise fixed rates as low as 4.99% p.a. from Police Bank.
Both its Goldrate and Police Value products offer investment options, with rates cut for those making principal and interest repayments on Friday.
The latest changes are as follows:
| Product | Fixed period | LVR | Change | New rate | Comp rate* |
|---|---|---|---|---|---|
| Goldrate Investment | Two years | <60% | -49bp | 5.15% | 6.02% |
| 60–80% | -54bp | 5.15% | 6.06% | ||
| 80–90% | -59bp | 5.15% | 6.10% | ||
| Three years | <60% | -105bp | 4.99% | 5.89% | |
| 60–80% | -110bp | 4.99% | 5.93% | ||
| 80–90% | -115bp | 4.99% | 5.96% | ||
| Police Value Investment | Two years | <60% | -44bp | 5.15% | 5.98% |
| 60–80% | -49bp | 5.15% | 6.02% | ||
| 80–90% | -54bp | 5.15% | 6.06% | ||
| Three years | <60% | -10bp | 4.99% | 5.86% | |
| 60–80% | -150bp | 4.99% | 5.89% | ||
| 80–90% | -110bp | 4.99% | 5.93% |
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Image by Kiros Amin on Unsplash
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