Powered by MOMENTUM MEDIA
subscribe to our newsletter

Non-majors slash variable mortgage rates

Three non-major lenders have dropped their mortgage rates in response to the Reserve Bank’s latest cut to the cash rate.

ME Bank, Bankwest and UBank are the latest lenders to announce home loan rate reductions following the Reserve Bank of Australia’s (RBA) decision to cut the cash rate to 0.75 per cent.

ME

ME has announced that it will cut variable rates across its mortgage products by 15 bps, falling short of the full 25 bps reduction.

The changes will apply to both new and existing customers and will take effect  from 24 October.

Advertisement
Advertisement

ME revealed that its online savings account interest rate (base and bonus rate) will also be cut by 15 bps, effective 8 October.

“In setting rates, ME has sought to strike a balance between depositors and home loan borrowers, as well as ensuring the pricing of products remains sustainable given the record-low interest rate environment,” the bank noted in a statement.

Bankwest

Meanwhile, Commonwealth Bank subsidiary Bankwest has announced that it will reduce variable home loan rates by between 13 and 25 bps, mirroring changes made by its parent company.

Bankwest’s rate changes will come into effect on Wednesday, 16 October.

PROMOTED CONTENT


The non-major’s standard variable rates (SVRs) will start from 5 per cent for owner-occupiers and 5.65 per cent for investors.

UBank

NAB subsidiary UBank has also reduced its variable mortgage rates.

Unlike its parent company, UBank has passed on the full 25 bps cut, with its changes to apply to all new and existing customers from 29 October 2019.

From 29 October, UBank’s mortgages rates will start from 3.42 per cent.

ME, Bankwest and UBank’s mortgage rate cuts follow cuts from all of the big four banks and non-bank lenders Athena Home Loans, Homestar Finance and Reduce Home Loans.

All four major banks fell short of passing the full 25 bps cut to home loan customers, with the moves sparking criticism from Commonwealth Treasurer Josh Frydenberg.

“The banks have a lot of explaining to do,” Mr Frydenberg said. 

“This is very disappointing by the banks, and customers should vote with their feet.”

The Treasurer encouraged borrowers to consider switching to alternative lenders with lower mortgage rates. 

“Now, some of the smaller lenders have actually passed on this rate cut in [full],” he said. 

“People should shop around, get the best deal, but also make their displeasure known to their banks because the rate cuts should be passed on in full, and that would be a good thing for consumers.”

[Related: ANZ, Westpac drop variable mortgage rates]

Non-majors slash variable mortgage rates
Non-majors slash variable mortgage rates
mortgagebusiness

Charbel Kadib

Charbel Kadib is the news editor on the mortgages titles at Momentum Media.

Before joining the team in 2017, Charbel completed internships with public relations agency Fifty Acres, and the Department of Communications and the Arts.

You can email Charbel on: This email address is being protected from spambots. You need JavaScript enabled to view it.

Latest News

Lenders have begun offering disaster relief packages for customers impacted by Tropical Cyclone Seroja in Western Australia. ...

Boutique lender Apickle has launched new finance product for SMEs using eftpos that enable them to borrow up to $200,000 without an asset se...

The federal government said it is pleased that higher confidence levels have led to a strong housing market but said that it is “keeping a...

FROM THE WEB

Join a group of highly informed brokers.

Broker Pulse, a community-driven knowledge base of lender performance Reveal exactly which lenders are making life easiest for brokers and their clients by taking this monthly survey and joining a group of highly informed brokers who leverage these insights every month.

JOIN NOW
podcast

LATEST PODCAST: Tackling the home deposit challenge

Do you expect to see strong uptake of the HomeBuilder scheme?

Website Notifications

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