Rams and ME Bank cut fixed year rates: How do they stack up against the big four?

Rams and ME Bank have both cut the interest rates on their fixed home loan products.

Following rate cuts by Commonwealth, NAB and Westpac last week, the two smaller lenders have also dropped their rates, with ME Bank undercutting them all on its five year fixed rate loan.

ME Bank now offers its five-year fixed home loan at a 4.94% interest rate, a 45 basis point cut. They have also cut their three year fixed loan interest rate to 4.69%. According to ME Bank, they are the lowest rates offered for three and five year fixed home loans on the market.

Chief executive Jamie McPhee said ME Bank's rates are better than those offered by the big four banks.

“And borrowers don’t need to pay an extra package fee to get the lower rate – we’re offering 4.94% on our non-package five year fixed home loan," said McPhee.

“Our three year fixed rate has been under 5% for more than 18 months and at a record low of 4.69% since April 2014.

He advised borrowers to fix their home loans, "with variable rates not expected to go much lower - we’re either at or very close to the bottom of the current interest rate cycle”.

ME Bank's rates are available to members of eligible super funds and unions.

Rams cut the rates on their two, three, four, five and ten year fixed home loan rates. Their five year fixed loan product is now offered at 5.19% per annum.

How ME Bank and Rams stack up next to the big four on five year fixed loans: