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Interest Rates

Lenders Slashed Interest Rates Even More than RBA For New Owner Occupiers

September 22, 2015

RBA has cut its interest rates to 2.0 per cent, to stimulate the economy, while it has been seen that some of the lenders have slashed interest rates to double as that of RBA, shown by figures collected by Mozo, interest rate comparison website.

According to Mozo:

  • The very first lender to offer competitive rate was Credit Union SA, where rate fall by 1 per cent in the previous year moving to 3.99 per cent

  • The same case is there with Community First Credit Union-owned Easy Street, where rate also fall by 1 per cent in the previous year moving to 3.99 per cent

  • For NAB, the rate fall to 0.93 per cent, moving to 4.15 per cent in the previous year

  • For Westpac, the rate fall to 0.89 per cent, moving to 5.08 per cent in the previous year

At this Mozo director Kirsty Lamont said, “Margins are healthy right now, funding costs are fairly moderate, and the smaller lenders are taking advantage of the traditional spring property market to try to ramp up their loan books”.

Reserve Bank governor Glenn Stevens on Friday said this trend would continue and I predict we will now see a number of people who used to call themselves investors are going to call themselves owner-occupiers because the relative pricing has changed. That will lead to some interesting dynamics, I suspect, over the next year.

News Source: http://www.smh.com.au/business/banking-and-finance/home-loans-getting-cheaper-as-lenders-wage-war-20150921-gjrelw.html

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