Australia’s lenders are still competing aggressively on fixed rate home loan interest prices, which may prompt more borrowers to fix their loan over coming months.
Two more lenders have reduced their three year fixed rate as of today.
has reduced both its standard and member package three-year fixed rate by 0.1% to 4.74%.
The standard products comparison rate is now 5.22%, while the member package’s new comparison rate is 5.44%.
ME Bank CEO Jamie McPhee said banks were competing harder for new customers because overall credit growth remained low.
“Today’s cut applies to both packaged and non-packaged loans, when many banks are only offering fixed rates deals on packaged loans.
“A fairer approach is to attract customers by giving them a long-term saving on their home loan, not just a short-term cash back sweetener at the start.”
Bank also reduced its two year fixed interest rate from today.
On its Home Package Plus loan, two year fixed interest rates with LVR of 90% or less (including LMI) has been dropped 0.05% to 4.80% per annum, while the standalone rate has dropped to 4.95% per annum.
Its two year rate with LVR of more than 90% is now 5.10% per annum, also down 0.05%. The standalone rate is now 5.10% per annum.
The comparison rate is 5.72% per annum and 5.78% per annum respectively.
reduced its fixed rates on Friday, with its two year rate dropping 0.05% to 4.99% per annum (with its Breakfree package rate 4.84%) and its three year rate dropping 0.08% to 5.20% per annum (with its Breakfree package rate 5.05%).
Fixed rates accounted for 26.08% of all loans written across the country in February – although their popularity is waning since a historical high mid-last year.