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Together, CBA, Wesptac, NAB and ANZ are known as the Big Four. As giants of the banking industry, they have a large suite of loan products, extensive in-person branch networks and big customer support teams.
But smaller Australian lenders and non-banks can offer great service and competitive interest rates, too. They are regulated by APRA and ASIC, just like the Big Four, and can offer home loan features and cashback offers, just like the Big Four.
And at the moment, banks big and small are competing for your business, with the lowest interest rates ever offered. See how the Big Four's home loans stack up against the rest of the market and find the right loan for you.
The table below contains some of the most competitive fixed and variable rates from Australia's Big Four banks plus comparable offers smaller banks, non-bank lenders and online lenders. While some of the products listed here are not currently available through Finder the "Enquire now" buttons allow to you leave your details and speak to a mortgage broker who can help you.
Australia's four banking giants are all unique in their own way and together, they account for roughly 75% of all mortgages in Australia.
The Big Four are the largest players in Australia's home loan market by far. To understand just how large their share of the market is, here's a snapshot of the latest APRA data showing the value of owner occupier and investor loans held by the Big Four and several of their nearest competitors.
This table shows the value of home loans "on the books" at each institution. Even the smallest of the Big Four holds more than three times more mortgages in dollar terms than the next smallest competitor.
Of course, market size and dominance is not necessarily an indication of whether a lender's loans are suitable for you. Nor is it an indication of quality customer service.
A home loan from one of the Big Four offers the same features as other lenders. Features such as extra repayments, redraw facilities and offset accounts are common.
While by no means exclusive to the largest banks, the Big Four often advertise their premium package loans. These products let you bundle a home loan with a credit card, bank account (which functions as an offset account) and other products. These days, the big banks often have the most competitive offers on their package loans and may offer a cashback if you switch to them from another lender.
And that's a big part of why banks do package loans. They want all your business, not just your mortgage.
Again, not exclusive to the Big Four, but these banks frequently offer these two types of products. Basic home loans have low variable rates (usually) but don't have offset accounts. Introductory rate loans offer a very low (usually variable) rate for an initial period, but increase later.
Mortgage lending in Australia is a thriving, crowded industry, with lenders big and small looking to lend you money. So it's always worth comparing a wide range of home loans. Alternatives to the major lenders include:
Lenders in the categories above often overlap. A small bank could be entirely online, while credit unions may have limited physical branches and a strong online service. And some banks are starting to use the technology of the fintechs.
Not necessarily. All of Australia's Big Four are Authorised Deposit-Taking Institution (ADI). But so are almost all the smaller banks, credit unions and digital banks. You can find more detailed information here.
In the unlikely event your lender goes bankrupt, it won't affect your ownership of the property as your loan account would pass to a new institution, who bought the assets of your now-defunct lender.
The only lenders who might not be covered by the bank guarantee scheme are very small neobanks, which are essentially financial start-ups. Most of these companies obtain a banking license or partner with someone who has one, and is an ADI. .
There are plenty of reasons borrowers stick with NAB, ANZ, Westpac or the Commonwealth Bank:
In most respects the Big Four are as good as any other lender. But depending on what you're looking for, you might be better served with one of their smaller competitors. Here are a few reasons why:
Most of the time, the Big Four banks don't offer the absolute lowest interest rates on the market. Smaller lenders, especially online lenders, could offer more competitive deals, with their reduced overheads and online infrastructure. In the current market, each of the Big Four offer very low fixed rate home loans that are among the lowest on the market (you can compare some of them in the table above). The Big Four banks also offer quite competitive variable rate loans too.
The Big Four don't specialise in loans for borrowers who have unique needs, such as borrowers who are self-employed, have a complex financial situation, have poor credit histories or are discharged bankrupts. This is where mortgage brokers and smaller, specialist lenders can help, as their loan policies and lending criteria may be more flexible.
The Big Four have strong online banking and well-designed apps, but there are smaller fintech lenders and neobanks who offer faster service, better apps and more tools to help you manage your mortgage. Although the gap in technology between new players and the old banks is shrinking all the time.
Australian lenders are relatively stable. As mentioned earlier, all registered financial institutions, regardless of their size, are regulated by the Australian Prudential Regulation Authority (APRA) and the Australian Securities & Investments Commission (ASIC).
Financial institutions are required to hold a certain portion of capital, as they provide a permanent commitment of funds and are available to absorb losses.
If your lender went bankrupt tomorrow you would still owe money to whoever took control over your old lender. This is quite rare, and wouldn't actually affect your mortgage contract.
You might not know this, but the nation's biggest institutions own or are associated with the following financial brands:
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Hi Sir,
Me and my husband are both Australian citizen but now both working in overseas with overseas income. We have an existing mortgage loan with Westpac and now want to refinance the loan with cash out (for personal use). I have talked to Commonwealth bank but they require both my husband and myself to sign the documents in the branch in Australia. However, we are unable to come back to AU in the short period of time.
It seems that not many bank will accept application with overseas income.
Is there any other bank/financial institution will accept application for my case?
Looking forward to hearing from you.
Best Regards,
Kathy
Hi Kathy,
Thanks for getting in touch with Finder!
Yes, there are options to refinance your home while you are overseas. See our home loans for Australian expats guide.
Kindly note that each lender has its own approach to foreign income. Most Australian lenders will only accept a certain percentage of your foreign income, which allows a lender to protect itself against factors such as fluctuating exchange rates. Also, lenders accept major currencies such as British Pound Sterling, US Dollar, Euro and etc. You can see part of the page saying “How is foreign income treated?”
As a friendly reminder, review the eligibility criteria of the loan before applying to increase your chances of approval. Read up on the terms and conditions and product disclosure statement and contact the bank should you need any clarifications about the policy.
Hope this helps!
Best,
Nikki