RBA Holds Steady, But Lenders Make Big Home Loan Moves

The Reserve Bank of Australia (RBA) held the cash rate steady at 4.35% in its December meeting, maintaining its cautious approach as inflation continues to ease. While many borrowers hoped for an early reprieve, the central bank’s decision signals that rate cuts may not begin until later in 2025.

RBA Holds Firm, Lenders Take Action

Despite the RBA pause, some lenders have made noteworthy moves in the home loan market—both positive and negative. These changes could be crucial for borrowers looking to lock in competitive rates or refinance.

Home Loan Market Moves

Pepper Money Introduces 40-Year Home Loan Terms

In a groundbreaking move, non-bank lender Pepper Money has rolled out 40-year home loan terms to a broader range of borrowers. Previously limited to unique situations like first home buyers, this option opens new doors for those seeking longer repayment flexibility.

• Rates start at 6.84% p.a. (comparison rates* from 7.02% p.a.)

Queensland Country Bank Slashes Variable Rates

On the positive side, Queensland Country Bank cut its variable packaged home loan rates, making significant adjustments for both owner-occupiers and investors.

• Owner-occupiers can now access a special variable rate of 5.89% p.a. (comparison rate* 6.24% p.a.) for principal and interest repayments.
• Investors can secure rates as low as 6.09% p.a. (comparison rate* 6.44% p.a.).

These changes mark cuts of up to 30 basis points, providing much-needed breathing room for borrowers.

Newcastle Permanent Hikes Fixed Rates

On the flip side, Newcastle Permanent increased its fixed home loan rates by up to 20 basis points, putting additional pressure on those looking to lock in long-term certainty.

New fixed rates for owner-occupiers include:

What This Means for Borrowers

With mixed movements across the lending landscape, borrowers face an important decision: take advantage of competitive variable rates, explore extended loan terms, or lock in fixed options before further hikes.

Secure the Right Home Loan With Vantage Loans

Navigating rate changes can be overwhelming, but you don’t have to do it alone. At Vantage Loans, we’re here to guide you through the ever-changing home loan market and help you secure the right loan tailored to your needs. Whether you’re a first home buyer, investor, or refinancing, our experts will ensure you get the best possible deal.

Contact Vantage Loans today—call us at 1800 595 500, email [email protected], or visit vantagefinancial.com.au to get started on your home loan journey.