Australia’s fourth largest lender, ANZ, has today cut its lowest variable rate back down to 2.29 per cent, but only for new customers.
The rate cut comes after the bank hiked variable rates by 0.25 percentage points on 13 May for new and existing customers following this month’s cash rate hike.
ANZ’s lowest variable rate
|Loan||Old rate||New rate||Change|
|ANZ Simplicity Plus|
Source: RateCity.com.au. Rate is for an owner-occupier paying principal and interest with a 70% LVR
ANZ is not the only big four bank cutting variable rates for new customers.
Last Tuesday, Westpac hiked rates for new and existing customers by 0.25 per cent on the majority of its variable rate loans. However, on its lowest variable rate it re-introduced a honeymoon rate of just 2.09 per cent, which increases by 0.40 percentage points after the first two years.
CBA also last week launched Unloan, a new digital offering with a starting variable rate of 2.14 per cent.
RateCity.com.au research director, Sally Tindall, said: “What these big bank cuts show is that competition in the mortgage market is still alive and kicking, despite the RBA hikes.”
“While most variable customers will now be dealing with higher repayments, some banks eager for new business are handing out exemptions,” she said.
“ANZ’s rate cut comes days after the launch of CBA’s new digital loan and Westpac’s relaunch of its honeymoon loan. Each of these moves puts more heat on the market to keep rates competitive for new customers.
“If you’re on a variable rate that’s on the rise, don’t just accept your fate. Get yourself a rate cut by switching to a lender willing to put a competitive price tag on your business.
“RateCity.com.au database shows there are still at least 4 lenders offering variable rates under 2 per cent after the May cash rate hike, including a rate of 1.79 per cent from Homestar Finance.
“Variable rate customers with ANZ and Westpac in particular, should pick up the phone and ask their bank where their loyalty lies.
“If years of paying your bank thousands of dollars in interest isn’t enough to get a better rate, it could be time to move your business elsewhere,” she said.
Current lowest big four bank rates
2.09% for 2 yrs then 2.49%
Source: RateCity.com.au. Rates are for owner-occupiers paying principal and interest. Some LVR requirements apply.