Home loan rate wrap: Westpac, Suncorp, UBank & more move rates

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AutoInsuranceMM.Info – Low income insurance – Home loan rate wrap: Westpac, Suncorp, UBank & more move rates

Canstar’s database shows seven lenders reduced interest rates on a range of fixed and variable home loans last week, despite expectations banks would hike rates to offset rising funding costs.

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A range of home loan products for owner occupiers and investors experienced a rate decrease last week, among a total of 53 product changes to fixed and variable rate loans.

Fixed rate home loans dominated rate reductions, with 32 cuts compared to only three for variable rate home loans, according to Canstar data.

The biggest cuts came from Mortgage House on some of its fixed rate investment home loans, with its Inv Advantage Fixed IO 1 yr recording the largest rate cut of 72 basis points to a fixed rate of 4.14% (*comparison rate 5.02%).

Suncorp Bank, People’s Choice Credit Union, The Rock, Yellow Brick Road and MyState also reduced rates on their fixed rate investment home loans by between 10 and 50 basis points.

Owner occupiers saw cuts on fixed rate home loans of up to 45 basis points from lenders, including Northern Inland Credit Union, Mortgage House and Yellow Brick Road.

The only lender to reduce variable rates for owner occupiers was NAB subsidiary UBank, which delivered a 10 basis point rate cut in a discount offer to new owner occupier customers paying principal and interest (P&I) repayments.

The rate reduction applies to loans of between $200,000 and $699,000, with the advertised interest rate currently sitting at 3.59% (*comparison rate 3.59%).

Westpac moves fixed rates up

Canstar data showed Westpac increased interest rates on five fixed home loans for owner occupiers paying interest only (IO) repayments last week.

The largest increase was seen on its Fixed Options IO 3 yrs 80% home loan, up by 14 basis points to a rate of 4.79% (*comparison rate 5.68%).

The majority of rate increases (both variable and fixed) in response to the rising cost of wholesale funding in recent months were from second-tier lenders, including the likes of Macquarie, AMP, ING, AusWide, Bank of Queensland, IMB and Bendigo Bank.

Canstar’s Group Executive of Financial Services Steve Mickenbecker said while smaller lenders had so far led the charge on rate hikes, there was mounting pressure for the majors to follow suit.

“Westpac’s move on interest only fixed rates reflects that even the major lenders are feeling the pressure of increased wholesale funding costs,” Mr Mickenbecker said.

For a full roundup of last week’s rate movements across fixed and variable rate home loan products for owner occupiers and investors, see below.

New owner occupier home loan rates

Principal & interest repayments

The table below shows owner occupier home loans with principal and interest repayments that experienced an adjusted rate between 17/07/18 and 23/07/18.

Rates based on owner-occupier home loans available for a loan amount of $350,000 at 80% LVR (principal & interest). Table sorted by provider name (alphabetically).

Interest only repayments

The table below shows owner occupier home loans with interest only repayments that experienced an adjusted rate between 17/07/18 and 23/07/18.

Rates based on owner-occupier home loans available for a loan amount of $350,000 at 80% LVR (interest only). Table sorted by provider name (alphabetically).

New investment home loan rates

Principal & interest repayments

The table below shows investment home loans with principal and interest repayments that experienced an adjusted rate between 17/07/18 and 23/07/18.

Rates based on owner-occupier home loans available for a loan amount of $350,000 at 80% LVR (principal & interest). Table sorted by provider name (alphabetically).

Interest only repayments

The table below shows investment home loans with interest only repayments that experienced an adjusted rate between 17/07/18 and 23/07/18.

Rates based on owner-occupier home loans available for a loan amount of $350,000 at 80% LVR (interest only). Table sorted by provider name (alphabetically).