National Australia Bank Ltd (ASX:NAB) has taken the pricing war among the big four banks to new heights by selling discounted mortgages online.

Following a controversial advertising campaign that claims it has broken up with the other banks, NAB will now be offering standard variable rate mortgages more than 1 per cent lower than most competitors.

The bank’s offer will see all standard variable rate mortgages sold online priced at 6.59 per cent and will last until the end of this month.

It comes only a couple of weeks after the bank posted a better than expected 16 per cent rise in first half earnings. NAB reported a net profit of $2.4 billion in the six months to March this year.

While the discounted mortgage rate only applies online, NAB still has the lowest mortgage rate among the major players, at 7.67 per cent. Rival Westpac has the highest mortgage rate in the market at 7.86 per cent, while Commonwealth Bank and ANZ are pricing variable home loans at 7.81 and 7.8 per cent respectively.