Seven months into the cash rate tightening cycle lenders are increasingly finessing their home loan rates strategies, with more choosing to pass on only some of the cash rate increase or holding back increases for some groups of borrowers.
According to the latest Mozo Banking Roundup ANZ responded to last month’s 25 basis point cash rate increase by increasing its variable rates by 25 bps. But later in the month ANZ cut its Simplicity Plus rates by 10 bps for owner occupiers with loan-to-valuation ratios up to 80 per cent. It also cut some investor rates.
Commonwealth Bank cut some of its home loan package rates. For loans with loan-to-valuation ratios of up to 60 per cent, CBA’s Wealth Package rate was cut from an advertised rate of 6.6 per cent on Friday to 4.57 per cent on Monday. For loans with LVRs between 60 and 70 per cent, the package rate was cut from 6.6 per cent to 4.6 per cent, and for loans with LVRs between 70 and 80 per cent the rate was cut from 6.6 per cent to 4.67 per cent. In some cases the package rate is now a cheaper option than the bank’s no-frills option.
Bank First limited the increases in its variable rates to 20 bps and MyState Bank limited its increase to 15 bps.
Other lenders that limited increases to some or all of their mortgage products, or cut some rates, included Great Southern Bank, HSBC, Ubank and Defence Bank.
Current variable rate leaders are Northern Inland Credit Union, which is offering 3.99 per cent for owner occupiers, ad MOVE Bank, which is offering 4.29 per cent for investors.
In the fixed rate market Police Credit Union has a one-year rate of 4.19 per cent; IMB Bank and Police Credit Union have a two year rate of 5.19 per cent; Southwest Slopes Credit Union has a three-year rate of 4.99 per cent, IMB Bank has a four-year rate of 5.39 per cent; and HSBC has a five-year rate of 5.49 per cent.