Community First Credit Union becomes second lender to offer sub-5% one-year fixed home loan

Community First Credit Union has joined the Greater Building Society by offering a one-year fixed home loan interest rate of 4.99% per annum effective today (October 24).

The credit union has cut its introductory one-year fixed home loan interest rate by 56 basis points, more than double the 25-point cut by the RBA on October 2.

Unlike the Greater Building Society, the 4.99% rate is not part of packaged rate offering, a point stressed by John Tancevski, chief executive officer of Community First.

“The best thing about this rate is that it is not part of a package with an annual fee," he says.

Tancevski says the credit union is able to offer the 4.99% rate because it is a "mutual organisation, owned by members, who also happen to be its customers".

Community First bills itself as the largest community based credit union and has been operating since 1959, with 11 branches in Sydney and on the central coast.

It has 76,000 members.

“Unlike our competitors, we don’t have the pressure to deliver large profits to pay dividends on shares to investors.  Our benefits are passed directly onto our members,” he says.

The credit union also offers a First Home Buyer Headstart loan, which provides a $2,000 cash bonus to first-home buyers who take out a Community First variable rate home loan.

Though NSW-based, Community First home loans are available to borrowers outside of the state.