NAB has made a surprising early move on interest rates, slicing 0.40% off its base variable rate home loan.
The reduction lowers NAB’s rate to 6.44% p.a. (6.48% p.a. comparison rate*) and is now available to new owner-occupier borrowers paying principal and interest, with only a 5% deposit required.
While the Reserve Bank (RBA) decided against adjusting interest rates this month, NAB’s proactive rate reduction may be a strategic play in a highly competitive lending environment.
According to Mozo’s finance expert, Rachel Wastell (pictured above), the cut appears to position NAB against other big four banks, particularly those offering digital-only, lower-rate loans.
The “cuts look to be a strategic move from NAB, making it more competitive with the digital-only offers launched by CommBank and ANZ Plus, while still offering borrowers the benefit of in-person service,” Wastell said.
She added that a customer with a $500,000 loan will see monthly repayments decrease by about $126, a notable savings even without an RBA rate cut.
NAB’s updated variable rate now stands out among the big four banks. The lowest rates available from other major banks are through digital-only options.
ANZ Plus leads with a 6.14% p.a. rate, and Commonwealth Bank’s Digi Home Loan offers 6.19% p.a. – both requiring refinancing and excluding in-person service. NAB’s in-branch service and lack of refinancing requirements set it apart as an appealing choice.
Here’s a snapshot of the lowest variable rates among the Big Four banks as of Nov. 14:
The reduced rate applies specifically to new borrowers, but Wastell suggested that existing customers contact NAB to request the same discount.
“For existing customers, it’s a good reason to pick up the phone and call NAB to see if they can get the same rate cut before Christmas,” she said.
With competitive rates also available from smaller lenders, borrowers may benefit from exploring other options to secure the best rate for their needs.
NAB, which recently secured an exclusive banking partnership with Raine & Horne, anticipates that Australia’s economy may soon shift from headwinds to tailwinds, though property price growth is expected to moderate in 2025.
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