Home loan war intensifies with HSBC rate cut
Cutting their variable rate loan by 0.59 of a percentage point to 4.75 just days ahead of the Reserve Bank of Australia's first monthly meeting next Tuesday indicates that the war is on to maintain market share in 2014.
The rate is now the lowest of any branch based retail bank. Interest rates have remain at record low levels and the move from HSBC follows NAB who dropped its four year fixed term home loan rate to its lowest level in 20 years - 5.44%
Mozo spokesperson Kirsty Lamont told journalist Sophie Elsworth that the latest move by HSBC indicates the fight between institutions has geared up a notch.
"The year 2014 is really shaping up as the year of the borrower, there's some red-hot rates on the market right now,'' she told news.com.
"There's signs that frenzy of competition that we are seeing right now could turn into a real prolonged home loan war.''
Ms Lamont also indicated that the lowering of rates outside of RBA decisions was uncommon. "It's unusual when most commentators are predicting that the cash rate will remain fairly stable,'' she said. "What we are also seeing is the big four banks are really fighting to retain their market share."
Head of mortgages for HSBC Australia, Alice Del Vecchio, said their move to slash rates was out of the ordinary.
"We've definitely gone out earlier than in previous years because our customers are telling us that they are taking the time to look at their loans and make sure they've got the best loan that they can possibly get,'' she said.
"We thought we'd head out this year and give customers and our competitors something to think about."
As the numbers currently stand there are a plethora of good deals in the market for property owners looking to buy or refinance.
NAB and ANZ have the lowest standard variable rates among the big four banks at 5.88 per cent while online bank UBank, owned by NAB, offers a standard variable rate of 4.62 per cent. HSBC also dropped its two, three and four-year fixed rates by up to 70 basis points. Its one-year fixed rate is its lowest of any fixed terms at 4.49 per cent.
Skip to Mozo's home loans tables and track down the most competitive home loans in the market or read the full news.com article here.