Powered by MOMENTUM MEDIA
subscribe to our newsletter

Major bank lifts fixed interest rates

A big four bank has announced that it has raised fixed interest rates on investor and interest-only home loans in a bid to meet its regulatory requirements.

Commonwealth Bank has announced that, effective immediately, fixed rates on interest-only loans for owner-occupiers will rise by 25 basis points.

Fixed rates for owner-occupier customers making principal and interest repayments have not changed.

For investors, interest-only loans will rise by between 25 and 50 basis points (depending on term) while investor principal and interest mortgages will rise by 25 basis points.

The bank said: "Commonwealth Bank is increasing home loan fixed interest rates for investment home loans and interest-only customers to ensure we continue to meet our regulatory requirements.

Advertisement
Advertisement

"Home loan customers who already have a fixed rate loan are unaffected by these changes. We continue to offer competitive rates across our products, including the equal lowest owner-occupier standard variable rate among the major banks. 

"We encourage home buyers to speak with one of our home loan specialists so we can provide them with a solution that is best for their circumstances." 

The moves come following new speed limits from APRA and industry surveillance by ASIC into whether lenders and mortgage brokers are “inappropriately recommending more expensive interest-only loans”.

New rates can be found below: 

Fixed Rate Interest-Only Owner-Occupier Home Loans

PROMOTED CONTENT


Product

Change (p.a)

New rate (p.a)

1 year fixed rate

0.25%

4.64%

2 year fixed rate

0.25%

4.24%

3 year fixed rate

0.25%

4.34%

4 year fixed rate

0.25%

4.64%

5 year fixed rate

0.25%

4.84%

     

Fixed Rate Principal and Interest Investment Home Loans

Product

Change (p.a)

New rate (p.a)

2 year fixed rate

0.25%

4.44%

3 year fixed rate

0.25%

4.54%

4 year fixed rate

0.25%

4.84%

5 year fixed rate

0.25%

5.04%

     

Fixed Rate Interest-Only Investment Home Loans

Product

Change (p.a)

New rate (p.a)

1 year fixed rate

0.25%

4.84%

2 year fixed rate

0.50%

4.69%

3 year fixed rate

0.50%

4.79%

4 year fixed rate

0.50%

5.09%

5 year fixed rate

0.50%

5.29%

[Related: Interest-only mortgage glut sparks default risk]

Major bank lifts fixed interest rates
mortgagebusiness

Are you a new-to-industry broker in the process of growing your business? Then there’s some great news: The Adviser’s New Broker Academy is back in 2021 and will provide you with essential insights into cutting-edge tools, strategies and processes to fast-track to success. Don’t miss your chance to attend. To secure your FREE place, visit newbroker.com.au now!

Annie Kane

Annie Kane is the editor of The Adviser and Mortgage Business.

As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts. 

Contact Annie at: This email address is being protected from spambots. You need JavaScript enabled to view it.

Latest News

The chief of Australia’s largest bank has said lenders should act pre-emptively and shift their floor rates for mortgage serviceability am...

Total household wealth reached a high of $13.4 trillion in the June quarter, primarily due to rising property prices, according to the Aust...

The property exchange settlement platform has been granted approval to establish an Electronic Lodgement Network in the ACT.  ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

How long do you think it should take to discharge a mortgage?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.