Variable interest rate setting in the mortgage market continues to move in both directions at once, with four lenders cutting rates, two increasing them and one having a bet each way in the week ending July 12.
Comparison site Canstar reports that Bendigo Bank, Great Southern Bank, Greater Bank and Tic:Toc cut variable rates, while Auswide Bank and People’s Choice Credit Union put them up.
Reduce Home Loans cut rates for some products and raised them for another.
Most changes were in the range of 10 to 15 basis points but some were significantly higher. People’s Choice Credit Union increased the rate on its basic variable owner occupier loan for loan-to-valuation ratios up to 80 per cent by 50 bps to 3.19 per cent (for new business only). It also increased the rate on its home loan package, with interest only payments, by 50 bps to 3.54 per cent.
Reduce cut the rate on its Rate Lovers loan by 30 bps to 1.99 per cent (on loans with LVRs up to 80 per cent), while increase the rate on its Investor Cash Back Hero Variable loan by 10 bps to 2.69 per cent (for loans with LVRs up to 80 per cent).
As reported previously, Tic:Toc is offering a variable rate below 1.9 per cent, after cutting its Live-In Variable P&I by 15 bps to 1.89 per cent.
There is a similar trend in the fixed rate end of the market, with four lenders cutting fixed rates and seven increasing them over the week.
Fixed rates continue to offer the best value for borrowers. For owner occupiers paying principal and interest, the lowest variable rate is 1.89 per cent, while the lowest two-year fixed rate is 1.78 per cent and the lowest three-year rate is 1.79 per cent.