Westpac 2.29% Variable Rate Home Loan (New Customers, Discount for 2 Years Only)


Looks like Westpac has dropped their variable rate for new owner occupier home loans. This new rate is so low compared to the other majors I almost thought it was a mistake. Edit: then realised it was just for the first two years.

From their website:

2.29% p.a.^ (2.72% p.a. comparison rate*) on the Flexi First Option Home Loan

Rate Includes a 1.64% p.a. discount for two years from loan settlement date reverting to a 1.14% p.a. discount for the life of the loan^.

Applies to new owner occupier home loans with principal and interest repayments. These rates do not apply to existing Westpac Home Loans, internal refinances or switches within the Westpac Group. Interest rates are subject to change.

Credit criteria and T&Cs apply.

Found this while I was working on a personal website to track home loan rates: RateRank (feedback welcome, site is a bit rough around the edges, mods feel free to remove if not appropriate)

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  • +9 votes

    (New Customers)? so what about existing customers?
    Thats why I love Athena! Automatic rate‑match. Existing customers score the same sexy new customer rates on their like-for-like loans.

  • It's Honeymoon rate.

    "Rate Includes a 1.64% p.a. discount for two years from loan settlement date reverting to a 1.14% p.a. discount for the life of the loan^."

    • Sure. 2.79% is good too though!

      But do Westpac change product names and push the rate up on the old products over time like some dodgy banks do?

  • Your website shows the comparison rate is not so good at 2.72%. UBank (backed by NAB) best comparison rate 2.49%, and if you wanted to go with a major bank NAB is best with 2.69%

    • Comparison rates don't mean squat, honestly. You need to work it out for your loan.

      • +2 votes

        Yes it does, it's a good, quick "at a glance" indicator to tell you if somthing is to good to be true. Keeping the lenders honest.

        Ie quickly exposes hidden fees and charges.

        While it may not be a exact indicator for your own loan, it does help weed out the weak long term loans.

        Drives me nuts when people say it doesn't mean anything. I question their motives.

        • it's not adjusted for your loan size so if you have a huge mortgage it will falsely skew it higher

        • It doesn't expose shit, you still need to know what the fees are for a product you are comparing too and it is based on a loan value so low it is almost always meaningless to everyone.

          • @nmartin84: Maybe everyone in cities. I live in CQ and got a 125k house loan and the fees were definitely a determining factor. Again this is probably an uncommon scenario but they definitely matter when you arent borrowing 500k+ and if you're looking to repay the loan off faster.

        • I'm just a dude with two finance majors that does something entirely different for a living

          For a 0.1% discount (typical package bonus) on $150k you don't even save the typical $395 annual fee.

          Most people have loans much bigger than $150k, in which case you're after the lowest rate, because the importance of the fee is so much smaller and also the package fees are usually very similar between banks ($295-395). If the fees are the same then you can look directly at the rate. Some smaller lenders may not have the fee.

          Its not until >$400k that you save a $395 package fee in interest costs. Although you need to consider other benefits such as credit cards (often not competitive anyway) and availability of offset accounts.

          TLDR: The bank advertises the lowest rate which involves a package fee. But you should not be paying a package fee on a $150k loan. Therefore the comparison rate is nonsense.

          • @justtoreply: I thought it good to add:

            Package fees also let you fix part of your mortgage without refinance costs. Some banks may not have refinance costs anyway or you might be able to get them waived. But the point is we're arguing about relatively small annual fees compared to what can be gained by fixing part of your mortgage.

            Fixed rates are 2.25%ish for 2-3 years. Vs say a 3% variable rate. For most loan sizes this will save well in excess of the fees you'd be charged.

          • @justtoreply: Don't bother replying to these fools. I think the majority on Ozbargain are teenagers or those in their early 20's who have little to no financial comprehension.

        • @wisc No it doesn't. You need to read up on what it means and what it's based off. It's generally based off $150k lending which is way below what most borrow.

          It can be very misleading…it's clearly misled you.

          • @SelfMade: yeah, and????? if you compare the comparison rate to the actual interest rate you get an idea of fees and charges, no one is saying - or at least i'm not saying, its going to give you an exact indication of the total amount you will pay for the loan.

            the comparative rate is going to be much higher if there are annual and signup fees, and equal to the actual interest rate if there are none. 150k is a little outdated, but does expose the fees quite well.

            as I said, its a good, quick at a glance indicator of other fees and charges that may be included in the loan.

            if its an extremely low interest rate with a high comparison, you wouldn't be far off to assume there are many fees associated with the loan, That said, it may be OK if you do borrow a large some of money as the benefits may out way the fees in your cases.
            it also may help identify where the lender has only advertised the introductory rate.

            if you are down to a smaller amount, it may not be suitable given your probably paying more in fees than interest… unless you want some of the features offered by the loan.

            Please don't try to belittle other ozbargain members, you have no clue of there history, or there knowledge. It's just quite rude and says more about you then them.

            I've done about 10 years in financial accounting system support. I also have a home loan which at the current projection will be paying off in under half the loan time (in under 5 years as it stands). (saving a hundred thousand in interest or so) - if things go as well as they could that could be done in just a few years. - while this may not be as good as many, i like to think i've done my research to ensure i'm getting a decent deal to get this down as quickly as possible.

            • @wisc: 'a good, quick at a glance indicator of other fees and charges that may be included in the loan.'

              It is just not…but no point arguing if you continue to be so concrete in your reasoning to argue against those who've worked in banks, have a financial background etc.

              Great that you are able to pay off your loan quicker than most but that has nothing to do with the above.

              Having a finance background myself, it is actually of much better value to invest that money elsewhere than pay off your non deductable home loan debt, especially at such low rates.

              • @SelfMade: " it is actually of much better value to invest that money elsewhere than pay off your non deductable home loan debt, especially at such low rates."

                Now at least that we can agree on.

        • +1 vote

          It's really not, it's an extremely misleading figure. Run the numbers yourself on your actual loan to figure it out.

  • No rebate ?

    • would like to know also

      • 2k for every loan plus 1k bonus for the first loan (so 3k for the first loan) until 31 Jan. I'm an accountant and referral partner with Westpac and just had their offer on the rate and rebate come through my email to share with my network recently.

    • Plus rebate/cashback.. Seems really good offer

  • I believe this rate is only available for the basic home loan offered at Westpac, so only redraw facility but no option to add an offset account or credit card. Something to keep in mind. Nonetheless it's a good rate + cashback.

  • pretty good deal combining with cash back.

    Best I could get from NAB is 2.64%

  • RateRank feedback:

    • Add Favicon.
    • Center-align some of the table columns (Rates, Offset, maybe even Type & Fee).
    • Currency indicator for Fee?
    • Force 2-decimals for Rates (4 = 4.00)
    • Add another break after footer text.
    • Remove table container background (bg-light)?
    • Contact links don't link to anything (yet?).
    • I defo second using a favicon and remove the link column.

      - Enable sort for other table headers e.g. offset, fee, bank
      - Concatenate bank and product name
      - Not sure this would be easy to pull and auto-maintain but a 'rebate' column. Would be a hit with OzB 😉

      • Thanks for the feedback. When you mention removing the link column, how would you prefer the table to link to the relevant lender?

        Rebate column will be tough…brokers seem to change their rebates every other day.

        • My bad I should have clarified - I instinctively kept clicking the bank logo/bank name for the link so you may as well just use that as the URL instead of an additional column. But I suspect this may be preference based rather than the norm :)

          • @supacheap: Hmm having logo as a clickable link isn't a bad idea, let me see if I can work out how to do that!

            • @keithality: I'd vote for 'product_name' to be the combined link.

              The below might be useful whichever way you decide, specifically the "formatter(value, row)" concept:

                  // force rates to 2 decimals
                  function rateFormatter(rate) {
                      return rate.toFixed(2)
                  // combine product_name + url
                  function productNameLinkFormatter(product_name, row) {
                      return '<a target="_blank" href="' + row.url + '">' + product_name + '</a>'
    • Also, where are the second tier lenders? No loans.com.au, Athena, etc even though in some cases they are simply the best deal.

    • Unless I couldn’t see it, my 2 cents:
      - add in loan type (fixed or variable)
      - add in characters after numbers (e.g. $ for fees, % for rates)
      - not sure it can be done, but add a filter to chop off rates at a certain point
      - look to add in some other institutions (credit unions etc) and change the header to “Lender”
      - can you do a loan scenario calculator at the beginning so you can see expected costs (e.g. add in loan amount and term)
      - you might consider a mobile vs desktop view, with the mobile view allowing you to display only a few columns so that it fits neatly in portrait mode

      • Thanks for your 2 cents, am planning to add fixed in the future but it will require a fair bit more effort. That being said fixed is certainly popular at the moment so I feel like it will have to be added.

        Loan calculator is a good suggestion thanks.

        Mobile is a tough one, removing info to make everything fit is a tradeoff.

    • Thanks for the feedback! Favicon is def a miss, will need to add that pronto

      • Nice site, as per above plus can we differentiate by I/O vs. P&I? Filter options would be good, by lender / rate min and max / type - fixed or variable / IO vs P&I etc.

        • Thanks, I/O together with fixed is something I can look to add in the future, but will require quite a bit of effort!

    • Mate overall well done buddy. I've been looking for such a simple website like this. I think it has a lot of value once finished.
      My wishlist is having
      Fixed vs Var
      IO vs P&I
      Major lender vs non-major or tier 1,2,3 - this is extremely helpful for those that have foreign income, own properties under a trust/company etc.

      I'm sure you had these on your roadmap anywhere. Looking forward to it developing.

      I'd even suggest an email subscription so you can notify users when new features arrive. Keep up the good work!

      • Thanks for your kind words, you're right most of the above is on the roadmap. I didn't think about an email sub until the other day, but definitely agree it has value. Cheers!

  • I was speaking with a mortgage broker recently and she indicated Westpac should be able to offer 2.09% for 3 year fixed.

  • Is Westpac best for home loans?

  • My rate at Westpac is still 2.74 variable, any suggestion where I can re-finance to?

  • OP - awesome rate comparison site.

    Just wondering, how accurate are the interest rates which include packages? e.g I noted CBA, 4.43%,4.84%, Investor, $395, Standard Variable Wealth Package, but this seems a bit on the high side?

    Thanks in advance!

    • Thanks mate.

      That rate looks right checking CBA's rates page , 'Standard Variable Rate' but likely most people don't have that and have one of their special offers.

      Tricky to represent just one rate when there are so many limited time offers and permutations.

    • OP would just be pulling the headline rate from the CBA website. The actual rate you might get offered (likely to be lower) may vary depending on the broker/banker and your specific circumstances.

  • lklk901, refinance with SunCorp, with $3000-4000 cashback, 2.69% with offset account

  • Westpac own website also shows 2.29% variable rate.

  • Would be all over this if they could match St George's $4k cashback.

  • no offset account for this?

  • +2 votes

    easy street 750K loan the rate is 1.95%, has offset and no fee if i recall

    • only for over $750K with maximum LVR of 80%

    • Construction fee $1500 plus application fee 500, total fees of $2000, I phoned them yesterday, for long term large loan this is the best offer currently in Market

  • No offset.

    • but you can redraw or deposit more into the loan account so essentially the same functionality as an offset account isn't it? and also you saving the 3xx annual loan package fee?

      • Not from an accounting point of view. Particularly for those that is looking to buy another property and turning current OO into an Investment Property.

  • Curiously, what is the best rate y'all are getting from the big4 atm?

  • ing's comparison rate is cheaper.

  • Is there any offer available for Interest Only Loan for investors?