Auswide Bank has announced that its reference rates for investment home loans will increase by 13 basis points, effective from yesterday (5 April).
This means borrowers with the standard variable rate of 5.85% on a $250,000 investment loan will pay $20.68 more per month (on a principal and interest loan over 30 years).
“Of course many of our investment loan customers are on rates less than the standard variable rate based on the size of their loan and any mortgage package they may have qualified for,” said Auswide managing director, Martin Barrett
The bank has also reduced its maximum LVR to 90% or less on all new investment loans.
These decisions protect the bank’s position in balancing its funding costs and lending income, Barrett said.
“As we recently reported to the market, our operating margin continues to sit just under 2% as it has done for many years.”
The rate increase and adjustment to the maximum allowable LVR also reflect market conditions and the prudent management of Auswide’s lending in the current environment, he added.
“We’ve witnesses a host of lenders, both large & small, bank & non-bank, all announce similar responses in respect to rate and lending policy over the last few days and weeks.”
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