BNZ started things a week ago when it widely advertised a promise that it will have “the lowest advertised two-year fixed home loan rate of the big four banks.”
Technically the claim was true as the fine print named the competition. However at the time ASB-owned Bank Direct was matching BNZ with a 7.40% two-year rate.
Then on Friday morning ASB moved to match BNZ at 7.40%. BNZ has responded dropping its rates another 5 basis points to 7.35% (although this is still unannounced).
New Zealand’s biggest non-bank lender, Sovereign, which is a sister company to ASB, jumped in on the game and dropped its two and five year rates.
Its standard two-year fixed rate is 7.55%, but its rate for home loans of more than $200,000 is 7.40%.
These rates are significantly below the bulk of the mainstream banks that are sitting on 7.75%. National Bank is the piggy-in-the-middle with a two-year rate of 7.60%. Overall two-year rates range from a low of 7.40% to a high of 8.55%.
The two year rate is important as it is currently considered to be one of the best options for home loan borrowers as these rates are significantly lower than floating rates which average around the 8.50% mark, and floating rates are likely to rise further this year.
You can compare and rank all the home loan rates on our rates table page here http://www.goodreturns.co.nz/section/200.html
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