Superbank is taking on the big boys again. Rob Stock looks at a small bank's mortgage innovation.
Monday, November 1st 2004, 7:17AM
by The Landlord
One niche bank is about to turn traditional mortgage wisdom on its head.
Superbank will tomorrow unveil a floating home loan rate way below its competitors, reversing what it sees as madness in the home-loan market.
What's more, the rate of 7.49 per cent will be guaranteed for seven months to the end of May so, however interest rates behave in that time, this rate won't rise - though it could fall.
Rates like that are generally to be found in the fixed-rate market, while the average variable rate loan from the big five banks is 8.5 per cent.
That's crazy, says Superbank managing director James Munro, because it means borrowers are actually paying, in many cases, over 1 per cent more interest for the uncertainty of not knowing what rates they'll be paying in a year's time.
