Lender challenges banks on rate rise fears
By
Kevin Eddy
|
15/07/2010 6:00:00 AM
|
1
comments
The founder of non-bank lender Opportune Home Loans has challenged the major banks over suggestions mortgage interest rates might increase outside the Reserve Bank cycle.
Paul Ryan, who also founded Wizard Home Loans in the 1990s, told Broker News there is "no reason" for banks to increase rates over and above the RBA — especially while many are still offering discount rates on home loans.
"There is no reason for banks to be increasing rates outside the cycle when they're still discounting mortgages by 0.6 to 0.7%," Ryan said. "You've got to question whether that's fair to consumers."
Warnings that banks may seek to increase interest rates independently began to circulate just before the most recent RBA rate announcement. Pressure on wholesale funding is being blamed, although no banks have gone as far as confirming that rates will be increased. Many commentators believe that, if banks were to increase rates, it would not happen until after the impending federal election.
Related stories:
Major banks biding time to raise rates
Banks ready to beat RBA to rate hikes
Latest Comments
Total:
1
comment(s)
Mike McHugh on
21 Jul 2010 09:55 AM
It''s the existing Bank customers who feel the real heat when interest rates are hiked above RBA guidelines. Many of them unable to chenge lenders due to property price uncertainties and deferred establishment fees.