If you’re a first homebuyer in Australia looking to secure a mortgage, the Bank of Melbourne home loan options might have caught your eye. With a strong reputation in Victoria and a range of competitive products, the Bank of Melbourne (BoM) offers a compelling option for many. But how does it really stack up?
In this deep-dive review, we’ll explore everything you need to know—from interest rates and borrowing limits to customer reviews and ethical standing. Whether you’re comparing home loans or looking to refinance, this guide is designed to answer all your questions in a clear, no-fluff manner—just like an experienced mortgage broker in Brisbane would.
Let’s dive in
The Top 5 Things Bank Of Melbourne Are Good At
The Bank of Melbourne is known for several key strengths, particularly for customers in Victoria, Australia. Here are the top 5 things Bank of Melbourne is good at:
#1 - Strong Local Presence in Victoria
Bank of Melbourne focuses exclusively on the Victorian market, which means they offer localised service and understand the unique needs of customers in this region better than national banks.
They tailor their products and support to suit the economic and lifestyle trends specific to Victoria. Their staff often have deep local knowledge, which helps in providing more relevant financial guidance.
#2 - Customer Service and Branch Access
They are known for friendly, personalised customer service with many conveniently located branches throughout Victoria, including in suburban and regional areas.
Unlike some major banks that have reduced in-person services, Bank of Melbourne maintains a strong physical presence to support customers who prefer face-to-face interactions. They also offer extended customer service hours and helpful in-branch staff trained to handle complex queries.
#3 - Home Lending Services
The bank provides competitive home loan products with tailored advice, especially helpful for first-home buyers. They also offer local home loan specialists and flexible features, such as offset accounts and redraw options.
Customers benefit from pre-approval services, rate lock options, and home loan calculators that simplify the borrowing process. The bank also runs educational initiatives and webinars for those navigating the property market for the first time.
#4 - Digital Banking Tools (via Westpac Group)
As part of the Westpac Group, Bank of Melbourne customers benefit from access to sophisticated digital banking platforms, mobile apps, and online security features.
The mobile app includes features like card management, instant payments, budgeting tools, and biometric login for added convenience. Regular updates and robust security protocols ensure users have a safe and seamless digital banking experience.
#5 - Community Involvement and Support
They actively support local communities through sponsorships, grants, and charitable initiatives, with a particular focus on health, education, and social welfare in Victoria.
Programs like the Bank of Melbourne Foundation provide funding to grassroots charities, making a real difference at a local level. They also encourage employee volunteering and partnerships with schools and not-for-profits across the state.
Top 5 Things Bank Of Melbourne Aren't So Good At
Here are the top 5 things bank of Melbourne mortgages aren’t so good at, based on common customer feedback and industry comparisons:
#1 - Limited Geographic Reach
Bank of Melbourne only operates in Victoria, which limits access for customers who move interstate or travel frequently. If you’re outside Victoria, branch support and localised services are unavailable, making it less practical for those needing a more national presence. This can be especially inconvenient for business owners or families with connections across Australia.
#2 - Less Competitive Interest Rates on Some Products
While they offer competitive home loans, other products, such as savings accounts or personal loans, may have less attractive interest rates compared to those of online-only banks. Customers looking for high-yield savings or the lowest rates might find better options with digital or challenger banks. This can make the bank less appealing to rate-sensitive consumers who prioritise return over brand loyalty.
#3 - Fewer Innovative Features Compared to Fintechs
Although they have solid digital tools through Westpac, they often lag behind fintechs in innovation and user experience. Features like real-time financial insights, automated budgeting, or investment tracking are less advanced or absent altogether. If you are a tech-savvy customer, you may find the digital experience functional but underwhelming compared to newer platforms.
#4 - Dependence on Westpac Systems
As a subsidiary of the Westpac Group, Bank of Melbourne relies heavily on Westpac’s back-end systems and infrastructure. This means that system outages, delays, or issues at Westpac can directly affect Bank of Melbourne customers. Some users feel this limits the bank’s ability to offer tailored or faster improvements independently.
#5 - Limited Rewards or Perks Compared to Bigger Banks
Bank of Melbourne doesn’t offer as many rewards programs, cash-back deals, or premium account benefits as larger national banks or credit card providers. This may be a drawback for customers who want value-added perks tied to their banking. Their loyalty offerings can seem minimal or generic in comparison to those of banks with more aggressive customer retention strategies.
What Are The Different Home Loan Products They Offer?
Bank of Melbourne offers a range of home loan products to suit different borrower needs—from first-home buyers to investors and refinancers. Here’s a detailed breakdown of their main home loan options:
This is a flexible home loan with a variable interest rate, meaning your repayments can go up or down depending on market rates. It is best for borrowers who want flexibility and plan to make extra repayments or redraw funds.
Key Features:
- Offset account: You can link an everyday account to your loan to reduce the interest charged.
- Redraw facility: Access any extra repayments you’ve made.
- Unlimited extra repayments: Pay off your loan faster without penalties.
- Split loan option: Split your loan between variable and fixed portions for balance.
- Portability: Transfer the loan to a new property without the need for refinancing.
This Bank of Melbourne home loan offers a fixed interest rate for a set period (usually 1 to 5 years), providing certainty in repayment amounts. It is best for borrowers who value repayment certainty and want to avoid rising interest rates.
Key Features:
- Fixed repayments: Predictable monthly payments help with budgeting.
- Option to lock-in rate: Rate lock feature can secure your fixed rate at application time.
- Limited extra repayments: You can make additional payments up to a capped amount per year (e.g., $30,000).
- No offset account during fixed period: You may lose access to some flexible features while the rate is fixed.
A simplified, low-fee home loan with a competitive variable interest rate and fewer features. It is best for first-home buyers or refinancers looking for a low-cost, no-frills option.
Key Features:
- Lower interest rates and fees: Ideal for budget-conscious borrowers.
- Extra repayments allowed: You can pay off your mortgage sooner.
- No offset account: Does not include premium features.
- Limited redraw facility: Access to extra payments is possible but restricted.
The Advantage Package is a popular Bank of Melbourne home loan add-on that bundles your home loan with other financial products, such as a credit card and transaction account, for a single annual fee. In return, you receive interest rate discounts, fee waivers, and access to premium features. It’s available on eligible variable and fixed-rate loans. It is best for borrowers looking for long-term value who want to bundle their banking products and enjoy ongoing cost savings and rate discounts.
Key Features:
- Discounted Interest Rates: Receive a reduced rate on both fixed and variable loans, which can result in significant savings over the life of the loan.
- Fee Waivers: Application fees, monthly account fees, and other charges on your loan and eligible bank accounts are waived.
- Credit Card with No Annual Fee: Get a fee-free eligible Bank of Melbourne credit card as part of the package.
- Offset Account Access: Eligible variable rate loans under the package come with a 100% offset account, helping reduce your interest.
- Split Loan Option: You can split your loan into fixed and variable portions, combining the benefits of both.
- Annual Package Fee: Approximately $395 per year (subject to change).
A home loan designed for people building a new home or completing major renovations. Funds are released in stages as construction progresses.
Key Features:
- Progress payments: The loan is drawn down in stages, reducing interest during the build.
- Interest-only during construction: You only pay interest on the amount drawn.
- Convert to standard loan post-construction: Switch to variable or fixed once building is complete.
- Builder verification required: The bank must approve your builder and construction plans.
The Family Pledge loan allows a close family member (typically parents) to use the equity in their own home as security to help you buy a property—without giving you cash. This reduces or eliminates the need for a large deposit and helps you avoid paying Lenders Mortgage Insurance (LMI). It is best for first home buyers who have strong income but limited savings, and family members willing to support them.
Key Features:
- No (or low) deposit needed: You can borrow up to 100% of the property value if the guarantor provides enough equity.
- Avoid LMI: By using a family member’s property as additional security, you may not need to pay LMI, which can save thousands.
- Limited guarantee option: The guarantor can choose to secure only a portion of the loan (e.g., 20%) rather than the full amount.
- Flexibility to remove the pledge: Once you’ve built sufficient equity (typically over 20%), the guarantor’s obligation can be released.
- Available with many home loan types: You can combine the Family Pledge with fixed, variable, or package home loans.
Important Considerations:
- Guarantor risk: The guarantor’s property is at risk if the borrower defaults.
- Legal and financial advice required: The guarantor must seek independent legal advice before proceeding.
- Only available for owner-occupied purchases (not investments): The borrower must plan to live in the property being bought.
What Documents Does Bank Of Melbourne Need For A Home Loan?
When applying for a home loan with Bank of Melbourne, it’s essential to provide comprehensive documentation to facilitate a smooth approval process. Below is a detailed checklist of the documents you may need to submit:
Personal Identification
- Primary Identification: Valid passport or Australian driver’s licence.
- Secondary Identification: Medicare card, birth certificate, or utility bill (to verify your current address).
Proof of Income
- Salaried Employees:
- Two recent payslips (showing gross and net income).
- Latest PAYG payment summary or group certificate.
- Most recent tax assessment notice or tax return.
- Evidence of consistent income deposits into your bank account.
- Self-Employed Applicants:
- Two years of personal income tax returns and full financial statements.
- Most recent ATO assessment notice.
- Business financial statements for the past two years.
- Details of any business commitments and liabilities.
Proof of Savings
- Bank Statements: Statements for all savings accounts held with other banks or financial institutions covering the last three months.
- Deposit Evidence: If your deposit includes gifts or sale proceeds, provide a letter confirming the gift and evidence of the deposit into your Bank of Melbourne account.
Property Details
- Purchasing an Existing Property:
- Copy of the signed Contract of Sale.
- Deposit receipt.
- Building or Renovating:
- Council-approved plans and specifications.
- Signed and dated building contract, including stages and payment schedule.
- Itemised tender/quote from the licensed builder.
- Deposit receipt for the builder.
- Investment Property:
- If already tenanted, provide a copy of the current Residential Tenancy Agreement and recent bank statements showing rent payments.
- If not tenanted, a letter from a real estate agent indicating the anticipated rental income is required.
Liabilities and Commitments
- Existing Debts:
- Statements for all loans not being refinanced, including mortgages, personal loans, car loans, credit cards, and store cards.
- Details of any extraordinary expenses, such as private school fees or maintenance payments.
- Rental Commitments:
- Current signed and dated lease/rental agreement.
- Letter from licensed property manager/agent detailing rental amount and frequency.
- Rental ledger from licensed property manager/agent.
- Bank statement or transaction listing covering at least two payment cycles detailing rental amount and payment date.
Additional Documentation
- Family Pledge: If a family member is guaranteeing part of your loan, provide a copy of the guarantor’s property valuation and a signed Family Pledge agreement.
- Trust Applicants:
- Certified copy of the Trust Deed.
- Minutes of the last three meetings held by the trustees.
- Identification details of the trustee(s).
- Company Applicants:
- Constitution of the company.
- Shareholder details and share certificates.
- Latest financial statements.
If you need assistance gathering these documents or have questions about the application process, feel free to get in touch with us at 1300 088 065 or book a free assessment online to see how we can help.
How Much Can I Borrow From the Bank Of Melbourne?
Bank of Melbourne determines your borrowing capacity based on several key factors, including your income, expenses, existing debts, credit history, and the size of your deposit.
Here are three borrowing capacity scenarios using bank of Melbourne’s lending criteria as a guide. Each example includes different income levels, the number of dependents, and monthly living expenses, assuming no other debts and a 30-year loan term with a variable interest rate of 5.89% per annum.
Scenario 1: Single Applicant, No Dependants
- Income: $85,000 gross per year
- Dependants: 0
- Monthly Living Expenses: $2,200
- Other Debts: None
Estimated Borrowing Capacity: $424,000
With no dependents and moderate living expenses, this applicant has strong serviceability. They may be eligible for a first home buyer grant or stamp duty concession in Victoria, which can also improve affordability.
Scenario 2: Couple with Two Dependants
- Combined income: $150,000 gross per year
- Dependants: 2
- Monthly Living Expenses: $3,800
- Other Debts: None
Estimated Borrowing Capacity: $700,000
Dependants and higher living costs slightly reduce borrowing power, but strong combined income keeps serviceability in a healthy range.
Scenario 3: Single Parent with One Dependant
- Income: $95,000 gross per year
- Dependants: 1
- Monthly Living Expenses: $2,700
- Other Debts: None
Estimated Borrowing Capacity: $440,000
While income is solid, having dependent and higher living costs impacts the overall amount that can be borrowed, still within a realistic range for many Victorian suburbs.
Note: These figures are estimates only and may vary based on credit score, lender policy changes, and how the bank treats different types of income (e.g., base salary vs. commissions).
For the most accurate figure, use Bank of Melbourne’s borrowing calculator or speak to a home loan specialist.
How Long Do Bank of Melbourne Home Loans Take To Approve?
The approval time for a Bank of Melbourne mortgage varies depending on the type of approval and the completeness of your application. Here’s an overview:
Conditional (Pre-) Approval – Typically within 1 to 2 business days after submitting all required documentation. Conditional approvals are generally valid for 90 days and can be renewed if needed.
Unconditional (Full) Approval – Varies based on several factors, including property valuation and additional documentation. After conditional approval, the bank conducts a property valuation and final checks before granting full approval.
Delays can occur if additional information is required or if there are complexities in the application.
What Else Does Bank Of Melbourne Offer?
In addition to home loans, Bank of Melbourne offers a comprehensive portfolio of products and services. Here is a list:
Transaction Accounts
Everyday banking accounts, such as the Complete Freedom Account, offer easy access to your money with features like contactless payments, mobile banking, and no monthly fees if the eligibility criteria are met.
Savings Accounts
Accounts such as the Maxi Saver or Incentive Saver reward regular savers with bonus interest, ideal for building an emergency fund or saving for specific goals.
Term Deposits
Fixed interest investments for 1 month to 5 years, offering a guaranteed return on your savings with flexible term options and competitive rates.
Credit Cards
Options include:
- Vertigo Card – Low interest rate for budget-conscious users.
- Amplify Rewards Card – Earn points on everyday spending.
- Low Rate Card – Simplified card with lower fees and interest rates.
Personal Loans
Unsecured personal loans for things like home improvements, weddings, or consolidating debt. They offer fixed or variable interest rates and flexible repayment terms.
Car Loans
Secured loans are designed for buying new or used vehicles, often with competitive rates and the option to make extra repayments.
Insurance
A range of insurance products through partners like Allianz and Westpac General Insurance:
- Home and Contents Insurance
- Landlord Insurance
- Car Insurance
- Travel Insurance
- Loan Protection Insurance
Business Banking
Financial tools and services for businesses of all sizes:
- Business transaction accounts
- Business loans and overdrafts
- Merchant terminals and EFTPOS solutions
- Equipment and vehicle financing
- Business credit cards
What Are Some Bank Of Melbourne Customer Reviews?
The Bank of Melbourne receives generally positive feedback from its customers, especially in areas such as personalised service and digital banking. Many Victorian locals appreciate the bank’s community focus and helpful home loan support. However, like most banks, it’s not without criticism — some customers have expressed concerns over fees and occasional service issues. Below is a balanced summary of what customers like and what could be improved.
What Customers Like
Great Customer Service – Many customers praise Bank of Melbourne’s staff for being friendly, professional, and genuinely helpful. This is especially evident during home loan applications, where customers feel guided and supported throughout the process. Personalised service and a local feel are often highlighted as key strengths.
Strong Mobile App – The Bank of Melbourne mobile app has received positive reviews for its ease of use, intuitive design, and range of features. Customers appreciate features such as real-time transaction tracking, cardless cash, and seamless integration with Apple Pay and Google Pay. The app even won a 2022 Mozo Experts Choice Award for its outstanding functionality.
Support During Hard Times – Long-term customers speak positively about the bank’s compassion and flexibility during periods of financial difficulty. Whether it’s adjusting payment plans or offering guidance during hardship, many feel Bank of Melbourne goes above and beyond to provide support during tough times.
Common Complaints
High Fees – Some customers feel that the bank’s account and transaction fees are higher than necessary. There are also complaints about penalty charges and a lack of fee transparency, especially when compared to digital or low-cost competitors.
Inconsistent Support – While many experiences are positive, some customers report frustration with the quality of support through phone banking or certain branches. Delays in resolving issues or lack of follow-up were common themes in the negative reviews.
Slow Transfers – A few users have mentioned delays in receiving incoming payments, particularly transfers from other banks. While this isn’t a universal experience, it has been noted enough to be a recurring issue for some.
Is Bank Of Melbourne An Ethical Australian Bank?
Bank of Melbourne demonstrates a commitment to ethical banking through various initiatives and practices, though certain areas may warrant further transparency and improvement.
Ethical Practices and Commitments
- Adherence to the Banking Code of Practice: As a signatory to the Banking Code of Practice, Bank of Melbourne is obligated to uphold higher standards of ethical behaviour, fair lending, and customer protection. This includes commitments to act honestly, fairly, and transparently in all dealings with customers.
- Community Engagement: The bank actively supports local communities in Victoria through the Bank of Melbourne Foundation, offering grants of up to $50,000 to organisations aiming to improve their local areas. This initiative reflects a dedication to social responsibility and community development.
- Sustainable Infrastructure: Bank of Melbourne has achieved a 6 Star Green Star rating for its 525 Collins Street branch, marking it as the first retail bank branch in Victoria to receive this certification. This rating signifies leadership in sustainable interior fit-outs and demonstrates the bank’s commitment to environmental responsibility.
Areas for Ethical Improvement
- Lack of Transparent ESG Reporting: Unlike some peers, Bank of Melbourne does not publicly disclose comprehensive Environmental, Social, and Governance (ESG) reports. The absence of transparency makes it challenging for stakeholders to fully assess the bank’s impact and commitment to ethical practices.
- Potential Fossil Fuel Financing: Independent assessments suggest that Bank of Melbourne may be involved in financing fossil fuel projects, which could conflict with global climate goals. Such activities raise concerns about the bank’s alignment with sustainable and ethical investment practices.
- Limited Ethical Investment Products: Although the bank supports the community, there is limited information available on offering financial products that specifically exclude investments in harmful industries, such as fossil fuels, tobacco, or weapons. This lack of ethical investment options may not meet the expectations of socially conscious consumers.
How Does Bank Of Melbourne Home Loans Compare To Other Banks?
When choosing a bank, it’s important to consider how well their services align with your needs, especially in areas like customer service, home loans, and digital banking. The table below compares Bank of Melbourne with Australia’s Big Four banks to highlight their key differences and strengths.
Feature | Bank of Melbourne | Commonwealth Bank | ANZ | Westpac | NAB |
Local Focus | Strong local focus on Victoria, tailored service | Nationwide coverage, less localised | Nationwide coverage, less localised | Nationwide coverage, less localised | Nationwide coverage, less localised |
Customer Service | Highly praised for personalised and friendly service | Generally good but can be impersonal due to size | Mixed reviews; sometimes impersonal | Mixed reviews; strong in some regions | Mixed reviews; variable experience |
Home Loan Products & Rates | Competitive rates, tailored for first-home buyers, local loan specialists | Wide product range, often competitive rates | Wide product range, competitive rates | Wide product range, competitive rates | Wide product range, competitive rates |
Digital Banking | Robust digital platforms powered by Westpac, award-winning app | Leading digital innovation and fintech features | Strong digital services with continual upgrades | Strong digital services, good mobile app | Good digital platforms with continual improvements |
Fees & Charges | Some customers report slightly higher or less transparent fees | Standard fees, competitive with occasional discounts | Standard fees, some complaints about fees | Standard fees, some complaints | Standard fees, some complaints |
Community & Ethical Commitment | Strong local community engagement with grants and sponsorships in Victoria | National and global CSR programs, some ESG reporting | National CSR programs with some ESG initiatives | National CSR programs, stronger ESG focus | National CSR programs, some ESG focus |
Bonus: How Much Can I Borrow From Bank Of Melbourne Personal Loan?
Bank of Melbourne offers personal loans from $2,000 to $50,000 unsecured and $3,000 to $100,000 secured against an eligible car, with repayment terms ranging from 1 to 7 years.
They set interest rates based on loan type and your credit history, typically between 7.49% and 20.59% p.a. You can apply online and often get quick responses if you’re an existing customer, but keep in mind fees like a $250 establishment fee and a $10 monthly account fee. To find out exactly how much you can borrow, use their online borrowing power calculator.
Bank Of Melbourne Home Loans FAQs
What types of home loans does Bank of Melbourne offer?
Bank of Melbourne offers variable, fixed, split, and line-of-credit home loans tailored to different borrowers’ needs. They also offer specialist loans, such as the Advantage Package and Family Pledge, for added flexibility. This range helps borrowers find options that suit first-time buyers, investors, and refinancing customers.
How competitive are Bank of Melbourne's home loan interest rates?
Their rates are competitive, especially for variable loans, often aligned with or slightly below market averages. Rates vary based on the loan product, borrower profile, and loan-to-value ratio. It’s best to check their current rates online or speak to a loan specialist for personalised quotes.
Can I get pre-approval for a Bank of Melbourne home loan?
Yes, Bank of Melbourne offers pre-approval to give you an estimate of how much you can borrow before you start house hunting. This helps you shop confidently and shows sellers you’re a serious buyer. Pre-approval typically lasts for 90 days, subject to verification of your financial details.
What documents do I need to apply for a home loan?
You generally need proof of identity, income verification like payslips or tax returns, bank statements, and details about your expenses and liabilities. If you’re self-employed, additional financial statements or tax returns may be required. The bank may also ask for property details if you’ve identified a home to buy.
How long does the Bank of Melbourne home loan approval process take?
Initial pre-approval can take anywhere from a few hours to a couple of days, depending on the completeness of your application. Formal approval after property valuation and documentation review typically takes 1 to 3 weeks. Delays can occur if additional information is needed or if the application is complex.
Does Bank of Melbourne offer loans to first-home buyers?
Yes, they provide special packages and discounts for first-home buyers, including tailored advice and lower fees. Their Family Pledge loan helps buyers who need extra security by allowing family members to guarantee part of the loan. They also offer government grant guidance and support throughout the buying process.
Can I make extra repayments on my Bank of Melbourne mortgage?
Most Bank of Melbourne home loans allow extra repayments without penalty, helping you pay off your loan faster. Some fixed-rate loans may have restrictions or fees for making extra payments; therefore, it’s essential to review your loan terms carefully. They also offer redraw facilities to access any extra repayments you’ve made.
What fees are associated with Bank of Melbourne home loans?
Common fees include application or establishment fees, ongoing account-keeping fees, and discharge fees when you pay out the loan. Specific fees depend on the loan product you choose and whether it has any bundled features or discounts. It’s best to review the Product Disclosure Statement (PDS) for exact fee details before applying.
Can I refinance my existing home loan to Bank of Melbourne?
Yes, Bank of Melbourne welcomes refinance applications and offers competitive rates to attract new borrowers. Refinancing may help you reduce your interest rate, consolidate debt, or access additional borrowing power. They provide refinancing calculators and expert advice to guide you through the process.
Does Bank of Melbourne provide online loan management?
Yes, customers can manage their home loans through the Bank of Melbourne’s online banking platform and mobile app, which is powered by Westpac’s technology. This includes making repayments, viewing statements, and using tools like redraw and offset account management. The digital platforms are designed for ease of use and secure banking anytime, anywhere.
Is A Bank Of Melbourne Mortgage Right For Me?
Whether a Bank of Melbourne home loan is right for you depends on your personal circumstances, financial goals, and location. If you live in Victoria and value strong local customer service, tailored loan advice, and access to Westpac’s digital tools, Bank of Melbourne could be a great fit. They offer a wide range of home loan products, competitive rates, and support for first-home buyers. However, it’s essential to compare them against other lenders and consider factors such as fees, flexibility, and your long-term financial plan.
For the best decision, consider speaking with a mortgage broker to get tailored advice based on your specific needs.
Our team at Hunter Galloway is here to help you buy a home in Australia. Unlike other mortgage brokers who are one-person operations, we have an entire team of experts dedicated to helping make your home loan journey as simple as possible.
If you want to get started, please give us a call on 1300 088 065 or book a free assessment online to see how we can help.
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