Heritage breaks the four per cent home loan barrier

Savvy Australian home owners have been paying less than five per cent on their mortgages for most of 2014, but Heritage today broke the magical four per cent barrier, offering one of the lowest advertised home loan annual percentage rates of any Australian bank[i].

The 3.99%PA one year fixed home loan rate (5.85%PA comparison rate*) is not only one of the lowest annual percentage rates currently advertised by any bank in the country[1], it’s also the lowest rate offered by Heritage in its 139 year history.

Heritage Bank CEO Mr John Minz said there would likely be few occasions in Australian history where interest rates would be as low as they currently are.

“We combed through 139 years of our own ledgers to see if we’d ever offered a lower rate, but even at the peak of the Great Depression in 1932, our rates for advances to buy property was typically around 5%PA. Our rates went close to 4%PA immediately after the Second World War, but then increased as the Reserve Bank of Australia took over the implementation of monetary policy in 1960,” Mr Minz said.

“We also looked at historical newspaper articles and Australian Bureau of Statistics data to see if we could find any evidence of other banks’ fixed home loan annual percentage rates ever being lower, but found nothing.

“If it’s not the cheapest time to borrow money in Australia’s history, it’s got to be awfully close.”

Mr Minz said Heritage’s new one year fixed home loan rate was part of the bank’s commitment to delivering better value to customers, and challenged any other bank to deliver a lower fixed home loan annual percentage rate.

“Heritage is able to offer an annual percentage rate as low as 3.99%PA (5.85%PA comparison rate*) because unlike the big four banks, we are owned by customers, so we always focus on giving customers a better deal, rather than making huge profits to pay dividends to shareholders. That mutuality means Heritage Bank can focus on generally delivering more competitive rates than the big four banks.

“I challenge any bank in Australia to offer better value to its customers than Heritage.”

Based in Queensland, Heritage Bank is Australia’s largest mutual bank. It has more than 300,000 customers and offers home loans nationally through a network of 100 branches, and through mortgage brokers. The 3.99%PA one year fixed rate home loan rate (5.85%PA comparison rate*) is available from 28 August, 2014.

All of Heritage Bank’s fixed rate loans are currently under the five per cent mark, with Heritage is also offering two years fixed at 4.49% (5.53%PA comparison rate*), three years fixed at 4.89% (5.54%PA comparison rate*) and five years fixed at 4.99% (5.47%PA comparison rate*)


1 Based on published fixed home loan rates of Australian banks as at 27 August 2014


*Based on $150,000 over 25 years. WARNING: This comparison rate is true only for the example given and may not include all fees and charges. Different terms, fees or other loans amounts might result in a different comparison rate.





* Based on a $150,000 loan over 25 years. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.