The rate is cut from 2.95%, representing a 45 basis point reduction for borrowers.
Customers can access the digital floating rate product direct from Heartland via its website.
It comes as the bank reintroduced its digital mortgage product in October. The digital platform is Heartland's lowest cost product, with one year fixed loans of 1.99%.
The new variable rate, effective this morning, is by far the cheapest in the market, ahead of Resimac's 3.39% rate.
Yet the product has finite availability, as it is not a permanent Heartland offering.
Heartland chief executive Jeff Greenslade said the bank's digital platform meant lower costs for borrowers.
“Customers shouldn’t have to pay so much for their floating home loan – nor should they have to take time from their busy day to go to the bank or meet with a mortgage manager to refinance their home,” Greenslade said. “By digitalising the application process, we can save our customers time and money.”
“Heartland’s group structure provides us with broader funding flexibility,” Greenslade added. “Alongside our digital strategy, we're able to offer products through innovative channels at a lower cost, and can pass that on to the borrower.”
To be eligible for Heartland Home Loans, customers must be refinancing or purchasing a standalone house on a single section, the bank said. Borrowers need a minimum 20% deposit and must be owner-occupiers.
A credit of $750 is available for customers who refinance their home loan to Heartland and take out a loan on the floating rate for at least 12 months, the bank said.