Commonwealth cuts fixed home loan rate

The Commonwealth Bank today announced it is reducing its three-year fixed home loan interest rate to 5.69 per cent available to new and existing borrowers from tomorrow.

New borrowers can also take part of their loan as an introductory 4.89 per cent one-year guaranteed rate loan.

Existing borrowers can switch to or split part of their loan at the new 5.69 per cent rate.

The Commonwealth says that recently more customers have been opting for split loan arrangements (one part fixed, the other part variable).

InfoChoice has noted a growing intensity in the competition in the three-year fixed rate – Westpac, Wizard and HSBC went below 6 per cent for the first time last week.

After offering rates between 5.6 and 5.8 per cent, other non-bank lenders have moved their rates upwards and over 6 per cent in the last couple of days as sentiment begins to grow that we may be close to the bottom of the interest rate cycle.

For more on the interest rate outlook, see RateWatch