Are these the cheapest home loan rates in Australia?

One of the country’s biggest non-bank lenders, loans.com.au has unveiled what may be the cheapest variable home loan rate in Australia. And already, a Tasmania bank has topped it with a locked-in fixed rate.

Loans.com.au’s new Smart Booster Home Loan is offering 1.99 per cent p.a. introductory variable rate (2.55 per cent p.a comparison rate) to first-home buyers or anyone looking to buy a property or refinance to a better rate, the company said.

The 1.99 per cent p.a. interest rate applies for only one year before it reverts to 2.57 per cent p.a.

Tasmania-based Bank of Us, a locally owned financial institution is offering a fixed-rate home loan of up to three years at 1.99 per cent p.a. This rate is locked in for a fixed three-year term while loans.com.au’s introductory 1.99 per cent p.a. is not.

Both offers are considered to be Australia’s lowest home loan rates under 2 per cent in an increasingly competitive market.

“This is the lowest variable rate we have ever offered,” Marie Mortimer, managing director of loans.com.au told the website Savings.com.au.

“Many people are keen to leave the big banks and are surprised to discover how easy it is to refinance and the great deals that are out there with online lenders. Many of our customers tell us that they delayed refinancing because they thought it would be a big hassle but it turned out to be much simpler than they expected and well worth the time invested,” she added.

The lowest rate on comparison site finder.com.au is UBank at 2.14 per cent p.a. for a one year fixed rate.