Variable Rates

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<p>ANZ has today revealed it is cutting its variable package rates for new borrowers by between 0.35% and 0.90%, bringing its package rates into line for all loan amounts.  </p>

<p>Canstar’s research shows the average variable package rate from the major banks is 3.43% and ANZ now offers the lowest of the major banks’ variable package rate offers for owner occupiers at 2.99% (3.42% comparison rate).</p>

<p><em>The changes for owner occupiers paying principal and interest (80% LVR) are as follows: </em></p>

<p><img alt="" height="231" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/anz_rate_cut.jpg" width="741"></p>

<p>Canstar Group Executive, Financial Services, Steve Mickenbecker says “Today’s cut from ANZ is the first cut to a variable rate by one of the big four banks since September last year, as interest rate cuts have since been focused on fixed rates.”</p>

<p>“The decrease from ANZ is being passed on to new borrowers by way of increasing the discount applied to its standard variable rate and will not be passed on to existing borrowers. "</p>

<p>“ANZ now offers the lowest package rate among the major banks and it would not be surprising to see others moving down the same path."</p>

<p>[smartcode_project:default project_id=4939]</p>

<p>“ANZ is seeking to grow its share of low risk business, with the gap between lending to borrowers with equity below 20 per cent and those with greater equity widening from 5 to 20 basis points," he concluded.</p>
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ANZ has today revealed it is cutting its variable package rates for new borrowers by between 0.35% and 0.90%

jordan_55689

ANZ cuts variable rates by up to 0.9%

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<p>The non-bank lender Reduce Home Loans has introduced a new market leading variable rate of 1.89% for low-risk refinancers.</p>
<p>The refinancers will be deemed low-risk if they have a 40 per cent deposit.</p>
<p>The Rate Cutter variable rate has a maximum loan size of $850,000, with the loan available for 60 per cent LVR.</p>
<p>There will no no offset account, but a full redraw facility.</p>
<p>The sub two per cent loan takes the number of home loan rates below two per cent to 13, according to comparison site Canstar.</p>
<p>Canstar say that switching from the average variable rate, which their figures say is 3.35 per cent, to the new low variable rate of 1.89 per cent, would save someone around $3,672 in repayments each year and $110,261 in interest over the life of the loan.</p>
<p>This is based on a $400,000 loan size, 30 year loan term and 60% Loan to Value Ratio (ie. 40% deposit). </p>
<p dir="ltr"><span>Canstar’s group executive of financial services Steve Mickenbecker said Reduce Home Loans’ new product was primed for refinancers with equity in their home and who haven’t been financially impacted by the pandemic. </span> </p>
<p dir="ltr"><span>“Reduce Home Loans’ new variable Rate Cutter loan at 1.89% represents a new low for the home loan market,” Mickenbecker said.</span></p>
<p dir="ltr"><span>“This comes on the back of a wave of rate reductions over the past few months as 12 owner occupied rates have fallen below 2%. </span></p>
<p dir="ltr"><span>“With a maximum loan to value ratio of 60%, the loan is clearly aimed at refinancers and shows the appetite lenders have for low risk lending in this environment. </span></p>
<p dir="ltr"><span>“The home loan market is ripe for refinancers who have strong equity in their property and have weathered the COVID-19 storm in sound financial shape.”</span></p>
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<p dir="ltr"><span> </span></p>
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jrobinson-rf4aSBido9

Reduce Home Loans offering variable rate to 1.89% for low-risk refinancers

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<p>Commonwealth Bank and ANZ have hiked rates for their variable customers, higher than Westpac's rise last week.</p>
<p class="x_MsoNormal"><span lang="EN-AU">CBA have increased their rates by 15 basis points percent, while ANZ have raised theirs by 0.16.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">ANZ were first to crack, raising their rates earlier today. Just 20 minutes later, Commonwealth Bank, the nation's biggest lender, followed suit.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">The move comes after Westpac were the first of the big four to <a href="https://www.urban.com.au/expert-insights/finance/88676-westpac-is-the-first-of-the-big-four-banks-to-hike-out-of-cycle" target="_blank">rate out of cycle. </a></span></p>
<p class="x_MsoNormal"><span lang="EN-AU">Westpac raised their basis points by 14 basis points.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">NAB continues to be the only big four bank to hold out.</span> </p>
<p class="x_MsoNormal"><span lang="EN-AU">Mozo director Kirsty Lamont said it's only a matter of time before NAB joins the fray.</span></p>
<p class="x_MsoNormal">“The latest interest rate hike from ANZ and the Commonwealth Banks comes as no surprise after Westpac opened the floodgates earlier," Lamont said.</p>
<p class="x_MsoNormal">"The big banks have been noticeably more strategic about the timing of their hikes this time around against the backdrop of the Banking Royal Commission. </p>
<p class="x_MsoNormal">With spring property season now in full swing, Lamont says mortgage interest rate hikes by some of the nation’s biggest lenders are likely to have a flow-on effect on the property market.</p>
<p class="x_MsoNormal">“These rate hikes couldn’t come at a worse time for property prices. Sizeable price drops have already been recorded across some of Australia’s capital cities and as the cost of borrowing rises, prices are likely to fall even further.”</p>
<p class="x_MsoNormal">Now coming into the 25<sup>th</sup><span class="Apple-converted-space"> </span>month of no movement in the cash rate by the Reserve Bank, the latest cycle of rate hikes is likely to keep official rates rises at bay for at least another two years.</p>
<p class="x_MsoNormal">RateCity.com calculated the Commonwealth Bank and ANZ new costs based on the banks’ standard variable rates for an owner occupier paying principal and interest.</p>
<p class="x_MsoNormal"><strong><span lang="EN-AU">CBA</span></strong></p>
<p class="x_MsoNormal"><a href="https://www.propertyobserver.com.au/images/2018/9/6/CBA-Figures.jpg" target="_blank"><span lang="EN-AU">Click here to enlarge</span></a></p>
<p class="x_MsoNormal"><strong><span lang="EN-AU"><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2018/9/6/CBA-Figures.jpg" alt=""></span></strong></p>
<p><br><strong><span lang="EN-AU">ANZ</span></strong></p>
<p><a href="https://www.propertyobserver.com.au/images/2018/9/6/ANZ-Figures.jpg" target="_blank"><span lang="EN-AU">Click here to enlarge</span></a></p>
<p><img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2018/9/6/ANZ-Figures.jpg" alt=""><strong><span lang="EN-AU"><br></span></strong></p>
<p class="x_MsoNormal"><span lang="EN-AU">Source:<span class="Apple-converted-space"> </span><a href="http://ratecity.com.au/" target="_blank">RateCity.com.au</a>.<br></span></p>
<p class="x_MsoNormal"><span lang="EN-AU">RateCity research director Sally Tindall said today’s hikes show that when one big banks pulls the trigger, their counterparts aren’t far behind.</span> </p>
<p class="x_MsoNormal"><span lang="EN-AU">“CBA and ANZ’s decision to hike rates hot on the heels of Westpac was a predicable step in what is becoming a well-worn routine," Tindall said.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“In fact, hiking on the same day means they can shoulder the backlash together.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“What this rate hike means is that the vast majority of variable rate home owners will now be shelling out more on their mortgage each month.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“NAB would do well to break free of tradition and find a different way to wear the additional expense,” she said.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“While Australia’s big banks might move like a flock of sheep it doesn’t mean their customers have to.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“If you live in your own home and own at least 20 percent of it, start shopping around – you’ll be surprised at what rates are on offer.</span></p>
<p class="x_MsoNormal"><span lang="EN-AU">“Plenty of lenders are ready and waiting to take on your business with rates as low as 3.44 percent,” she said.</span></p>
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CBA and ANZ hike variable home loan rates

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<p>The Commonwealth Bank has increased its standard variable investor home loan interest rates by 7 basis points, to 5.56 per cent per annum.</p>
<p>It also increased its Viridian Line of Credit interest rates by 15 basis points, to 5.78 per cent  per annum.<br><br>No changes have been made to interest rates for owner occupiers with the owner occupier standard variable rate at 5.22 per cent per annum, the lowest among the major banks.</p>
<p>Business rates also remain unchanged.<br><br>“We have carefully considered the current environment when making this decision – in particular the higher costs associated with funding mortgages, the increased capital costs associated with providing home loans, and the need to remain below the regulatory 10 per cent investor home loan growth cap.</p>
<p>We believe these changes balance the needs of our borrowers and shareholders, while helping to underpin the long-term sustainability of the Australian home loan market,” said Matt Comyn, Group Executive for Retail Banking Services.<br><br>The new rates are effective from 16 December 2016. </p>
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jchancellor-FAypfDUnLy

Variable rates start to rise at CommBank

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<p><span>Macquarie has joined the big four and St George Bank in increasing their variable rates for owner-occupiers and investors.</span></p>
<p><span>With a 20 basis points rise, Macquarie’s standard variable rate will be 5.70% for home owners, and 5.97% for investors.</span></p>
<p><span>St George opted for a 15bp rise, which will bring their owner-occupied variable rate to 5.69% and investment rate to 5.94%.</span></p>
<p><span>Their rate increases come into effect November 20.</span></p>
<p><span>Macquarie operates on the same APRA controlled internal risk-weighting model as Australia’s four major banks.</span></p>
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Macquarie to raise rates by 20 bps

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<div><span style="line-height: 1.3em;">These are the top variable investor loan rates available right now, including minimum loan amounts and maximum LVRs, according to banking comparison website Mozo.</span></div>
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<strong>Commonwealth Bank</strong> is applying a premium to its fixed rates for investors - 30bp for 1 and 4 years, 40bp for 2 and 3 years, and 10bp for 5 years. </div>
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<strong>Bankwest</strong> has capped LVR's at 80% for investors across most products. Rates are higher for investors on its 2 year fixed rate and the 3 year introductory rate on its Super Start Home Loan. </div>
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<strong>NAB</strong> is limiting the maximum LVR on investor loans to 90%. </div>
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<strong>St.George/BankSA/Bank of Melbourne</strong> has a discount on its Basic Home Loan of 34bp for owner occupiers and its 2 year fixed rates are 20bp lower for owner occupiers. </div>
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<div><strong><span style="text-decoration: underline;">2nd TIER LENDERS</span></strong></div>
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<strong>ING Direct </strong>increased fixed rates for investors by 20bp and removed discounts for investors with larger loan amounts and lower LVR's on its Orange Advantage and Mortgage Simplifier variable rate loans. The interest only option is now only available on loans with LVR's less than 80%. </div>
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<strong>ME Bank</strong> now applies a premium for investor loans of 15bp to the variable rates on its Flexible Home Loan Member Package. </div>
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<strong>AMP </strong>has ceased accepting applications for investor loans and adjusted the rates and tier levels on its Professional Package. Variable rates now start at 4.12% for loans over $750,000. ANZ's Simplicity PLUS loan is no longer available for investors and there's a premium on the bank's fixed rates of 40bp for 1 and 4 years, 60bp for 2 and 3 years, and 30bp for 5 years. </div>
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<strong>Suncorp</strong> is charging a premium to investors on its variable Home Package Plus which varies depending on loan amount and LVR, and has imposed a maximum LVR for investors of 90%. For LVR's less than 80% the rate for owner occupiers borrowing more than $750,000 stayed at 4.15%, but increased by 9bp for owner occupiers borrowing less than that, while increasing by 29bp for investor loans under $750,000 and increasing by 24bp for investor loans over that amount. For LVR's 80 to 90% the rate was cut to 4.34% for all owner occupiers but for investors the rate stays at 4.49% for under $750,000 and 4.44% for more than that.</div>
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<div><strong><span style="text-decoration: underline;">NON-MAJOR LENDERS</span></strong></div>
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<strong>Freedomlend</strong> has increased rates for investors by 10bp and capped LVR's at 80%. </div>
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<strong>Heritage Bank</strong> increased variable rates for investors by 30bp across most products and there's now a 10bp premium for its fixed rates. </div>
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<strong>Homestar </strong>increased rates for investors by 10bp and now has a maximum LVR of 85%. </div>
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<div><strong><span style="text-decoration: underline;">BUILDING SOCIETIES, CREDIT UNIONS &amp; MUTUALS</span></strong></div>
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<strong>CUA</strong> has dropped the maximum LVR on its Fresh Start loan from 80% to 70% for investors, and launched two new products (Fresh Start Access and Fresh Start Basic) that are priced 30bp higher for investors. </div>
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<strong>Newcastle Permanent Building Society</strong> will lend up to 80% LVR for investor loans and applies a $550 application fee. </div>
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<strong style="line-height: 1.3em;">UBank</strong><span style="line-height: 1.3em;"> will apply a 29bp premium to investor and interest only loans from 10th August.</span>
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<strong style="line-height: 1.3em;">Westpac</strong><span style="line-height: 1.3em;"> has capped LVR's for investor loans at 80%, and is charging an extra 15bp for investors during the 2 year introductory rate period on its Flexi First Option Home Loan.</span>
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<strong style="line-height: 1.3em;">ANZ</strong><span style="line-height: 1.3em;">'s Simplicity PLUS loan is no longer available for investors and there's a premium on the bank's fixed rates of 40bp for 1 and 4 years, 60bp for 2 and 3 years, and 30bp for 5 years.</span>
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<div><a href="/images/2015/08/04/investor_loans.jpg" target="_blank"><span style="line-height: 1.3em;">Click to enlarge</span></a></div>
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<br><p><span>FOR INFORMATION ON PROPERTY LOANS, RATES AND MORE, VISIT MOZO.COM.AU OR <a href="http://propertyobserver.com.au/forward-planning/tools/ebooks-and-webinars/42368-get-loan-savvy-expert-tips-for-a-first-time-investment-or-refinancing-loan-in-a-free-ebook" target="_blank">CLICK HERE</a> FOR THE</span><span> FREE <em>PROPERTY OBSERVER</em> EBOOK, <em>GET LOAN-SAVVY – TIPS FOR A FIRST TIME, INVESTMENT OR REFINANCING LOAN</em>, WHICH HELPS YOU DECIDE ON A HOME LOAN THAT MEETS YOUR REQUIREMENTS.</span></p>
</div>
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