Broker News

Two lenders announce interest rate changes

Lender interest rates are continuing to rise with two lenders announcing changes to their interest rate policies.

NAB has increased the interest rate on its two, three and four-year fixed rate home loans – to 3.98%, 4.09% and 4.59% respectively.

The major bank has also increased the fixed rate on its two, three, four and five-year residential home loans, bringing the two-year rate to 4.19%, the three-year rate to 4.29%, and both the four-year and five-year rate to 4.79%.

However, NAB has reduced its one-year fixed rate home loans to 3.89% for owner-occupiers and its one-year fixed rate for residential investment home loans to 3.99%.

NAB chief operating officer, Antony Cahill, says the cost of providing fixed rate home loans has increased over recent months.

“We continue to watch market and economic conditions to ensure we continue to lend and manage our business responsibly, so we remain strong and stable for the benefit of our customers, shareholders, and the broader economy.

Cahill points out fixed rate applications more than doubled as a share of total applications in December compared to September last year.

NAB’s new rates are effective Monday 16 January.

In addition, Heritage Bank has increased new and existing variable investment loans by 0.15%, and its two to five-year fixed rate loans by 0.10% (effective 17 January).

However, CEO Peter Lock says Heritage’s home loan rates remain highly competitive.

“The cost of funding our loans is affected by the overall state of financial markets. Changing circumstances such as increased financial volatility do have an impact on markets and can flow through to increase our costs,” Lock says.

“We will continue to adjust our pricing, for both depositors and borrowers, depending on what is happening across the marketplace.”

Published on: Monday, January 16, 2017

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