Rate changes “running rife”

by Madison Utley13 May 2019

Two banks have joined the rank of lenders reducing rates “ahead of the Reserve Bank curve.”

ANZ has lowered its fixed rates, while Macquarie Bank has made adjustments to both fixed and variable.  

Canstar group executive of financial services Steve Mickenbecker explained, “The banks are anticipating an official cut to the cash rate in the coming months and are not waiting on the Reserve Bank to move.

“They are instead using this period to sharpen the pricing pencil to attract new business.”

At Macquarie, variable home loans for new owner occupiers paying P&I and interest only have been decreased by up to 0.21%, and loans for investors paying P&I and interest only have decreased by between 0.11% and 0.51%.

Fixed rates across the board were reduced between 0.10% to 0.20%.

Unfortunately, existing borrowers looking for lower rates are going to have to wait for the RBA to make a move.

ANZ has instituted a discount on its Breakfree package, decreasing the three-year fixed rate by 0.30% and the five-year by 0.20% on owner occupier loans paying P&I. For interest only, the two-year fixed has been reduced by 0.20% and the three- and five-year by 0.60%.

For investors paying P&I, the three-year fixed rate has been taken down by 0.20% and the five-year has been reduced by 0.26%. The three-year interest only fixed rate has been cut by 0.30%

“Times have changed,” said Mickenbecker, referencing the cuts for investors paying interest only.

He added, “A year ago lenders did not want to know this group of borrowers, responding to APRA's lending restrictions on investors paying interest only. Now, [Macquarie’s] rate cuts bring investors into line with owner occupiers, with interest only rates down to 4.19% for 70% LVR loans.”