For owner-occupiers paying principal and interest, the change translates to savings of $17 a month, or $204 a year, for the average mortgage holder.
Owner-occupiers paying interest-only will pay an extra $99 a month or $1,188 a year, while for investors paying interest-only, the change will add an extra $100 a month, or $1,200 a year, on to their repayments.
What this means for customers
RateCity money editor Sally Tindall said the changes would receive mixed reviews from customers.
“A drop of 8 basis points for owner-occupiers paying down their debt is a small reward for customers who are doing the ‘right’ thing.
“While $17 a month might seem like small change, for some people paying off their home loan, every dollar really does count.
“Meanwhile, Westpac has shown it’s prepared to sting its investors hard with a 34-basis-point jump for anyone who opts not to pay down their principal.
“Today’s rate changes are another move to comply with APRA’s new interest-only requirements, however it has the added benefit of generating more profit from customers who are willing to cop the higher rates.
“Last week’s ABS housing finance figures suggest some new investors are getting cold feet as a result of APRA’s intervention. The big question will be whether this cooling will last,” she said.
Westpac standard variable rate changes
|Loan structure||Old rate||New rate||Change||Old monthly repayments||New monthly repayments||Change|
|Owner-occupier principal and interest||5.32%||5.24%||-0.08%||$1,948||$1,931||-$17|
|Investor principal and interest||5.79%||5.79%||0%||$2,051||$2,051||$0|
Big four banks – current standard variable rate list