A listed Australian lender has increased rates on one of its mortgage products by 20 basis points in response to higher funding costs.
A pricing and policy update from Australian First Mortgage (AFM) on Friday noted that specialist lender Pepper had increased rates on its specialist and near prime products by 10 basis points, while its prime product has increased 20 basis points.
“As has been widely reported, wholesale funding costs have increased in recent months and as a result Pepper have advised interest rates will increase,” the AFM update said.
“The rate changes for new applications will be effective Monday 16 November.”
Alongside these changes, Pepper has announced a new promotion reducing upfront mortgage risk fees by 0.25 per cent. This will see savings in upfront fees of as much as $1,000 on a $400,000 loan.
“This special offer is available from 16 November through to 31 January 2016,” AFM said.
Meanwhile, Adelaide Bank has repriced its fixed-rate home loans, according to AFM.
“Effective Thursday 12 November, Adelaide Bank will be decreasing their three-, four- and five-year investor fixed rates for flexible option loans.”
Adelaide Bank’s three-, four- and five-year fixed rates have been cut by 25 basis points. The AFM update highlighted that new rates will apply for both full- and low-doc investor loans.