Interest rates movements
We have had many moves on interest rates. All outside movement from the Reserve Bank.
Investment lending has been the focus. Most finance institutions have moved on their investment rates – both variable and fixed.
But the latest move of two of the majors – involved both owner occupiers and investors.
Westpac has followed National Australia Bank’s lead and hiked home loan interest rates.
The major bank announced it would increase rates for owner occupiers by 0.03 percentage points to 5.32% for customers making principal and interest repayments.
For owner occupiers making just interest payments, their rates will increase by 0.08 percentage points to 5.49%.
Property investor loans will climb by 0.23 points and 0.28 on interest repayment only loans to 5.79% and 5.96%.
The bank cited the rate change is in response to increasing funding costs.
“We understand the significance of interest rate changes to our home loan customers, so we take a very careful approach to these decisions,” Westpac’s chief executive of consumer banking, Mr Frazis said. “We try to balance the needs of both owner occupiers and investors in making these decisions while continuing to provide customers with a competitive offering across our range of products.”
Westpac’s rate hike follows a similar move by NAB with an increase of 0.07 points and 0.25 points for investors, again pointing to increased funding costs and concerns about its level of lending to investors as the reason behind the decision.
Both banks however were hitting the market with specials trying to increase their market share in the residential lending space. The latest increases still have the four majors all in a similar range for their variable principle and interest loans between 5.22% & 5.32%.
Customers still need to look beyond the headlines. There are still good rates below 4% with specials, packages and other discounts available. A lot of the banks are still also offering to cover the switching fees for clients looking to better their rate.
Contact us today so that we can check your current structures are bang up to date!
Donna-Lee Parkes
Credit Adviser
0418 903 954