Boutique lender Greater Bank has set a document low for a fixed rate mortgage, signaling rising competitors for lenders round short-term fixed charges.
Boutique lender Greater Bank has set a document low curiosity rate for a fixed rate mortgage, signalling rising competitors for lenders round short-term fixed charges.
Greater Bank introduced this week that it had slashed its one and two-year fixed rate loans for owner-occupiers to 1.59 per cent, the bottom fixed rate ever supplied in Australia.
The rate is on the market for owners with properties in New South Wales, Queensland and the ACT.
Analysis by Canstar exhibits that if a house owner refinances a $500,000 mortgage from the typical variable rate of three.14 per cent to a two-year fixed rate of 1.59 per cent, they might save as much as $9,576 over the time period of a brand new mortgage.
Greater Bank’s transfer follows cuts to two-year fixed rate loans by St George Bank, Bank of Melbourne and AMP.
In complete, seven lenders have lower two-year fixed rate loans within the final month, whereas two lenders have slashed one-year fixed rate mortgage charges.
RateCity.com.au analysis director Sally Tindall mentioned the strikes have been a sign that banks have been prepared to battle on short-term fixed rate loans on the similar time that longer-term fixed charges have been broadly on the rise.
“Greater Bank has thrown down the gauntlet to its competitors, dropping to a new record low,” Ms Tindall mentioned.
“(RBA) Governor Lowe’s insistence the money rate is not going to rise till no less than 2024 has given lenders the reassurance they should hold their short-term fixed charges ultra-competitive.
“While most banks’ revert charges are considerably increased, these new fixed charges from Greater revert to a aggressive 2.19 per cent, however solely for new clients beneath sure phrases and circumstances.
“This might be the lowest mortgage rate in Australia’s history, but before you jump in, make sure it suits your finances.”