The big event for home loan borrowers last week was the Reserve Bank’s decision to lift its Official Cash Rate a quarter of a percent (0.25%) to 6.75%.
As a result of this rise all lenders will increase their floating rate home loans by the same amount. However these rises take some time to come through.
Typically Westpac is one of the first out of the blocks to make these rises and it didn’t disappoint, announcing the change on the same day as the Reserve Bank’s announcement. What is surprising is that it increased its floating rate to 9.05%.
This rate will probably be slightly higher than where the other banks move to.
To date none of the other trading banks have increased their variable rates.
Westpac’s increase adds $25.61 to a monthly payment on a $150,000 mortgage on a 25-year term.
Besides the Reserve Bank announcement it was a relatively quiet week.
The only other bank to move rates was The National Bank which dropped its one-year rate to 7.70%.
Amongst the non-bank lenders Equitable and Global Home Loans increased all their fixed rates and Resi Mortgage Corp lifted its one and two-year rates.
The majority of floating rates currently sit within a tight range going from 8.20% to 9.05% (although there are a couple of small lenders outside this range).
One-year rates range from Southern Cross at 7.35% to NZ Mortgage Funds at 8.55%.
Bank Direct has the lowest standard two-year rate, at 7.50% and NZ Mortgage Funds has the highest at 8.54%.
To compare home loan rates go to Good Returns http://www.goodreturns.co.nz/section/200.html
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