bcu, a division of P&N Group, has set a new low for mortgage rates, with a one-year offer of 1.67 per cent for owner occupiers.

It is also offering a one-year fixed rate of 1.87 per cent for investors – a new low for investors.

Previously, Greater Bank’s offer of 1.69 per cent on a range of fixed rates was the lowest mortgage rate in the market.

Canstar said the bcu one-year rates are the lowest mortgage rates in its database, Currently, there are 190 mortgage rates below 2 per cent in its database.

In addition to bcu and Greater Bank, RACQ Bank, Homestar and UBank have rates under 2 per cent.

bcu cut its one-year owner occupier and investor rates by 31 basis points. It does not offer a redraw or offset facility with its fixed-rate loans and does not allow borrowers to make additional repayments.

bcu increased four and five-year fixed rates by up to 20 bps. Its standard variable rate is a relatively high 4.06 per cent.