ME Bank strays from fixed rate hike trend with 10bp cut
ME Bank has made a range of interest rate changes on its mortgages, though this time the news is positive for borrowers looking to secure a one year fixed rate. Owner occupiers and investors can now access ME one year fixed rates 10 basis points lower at 3.89% and 3.99% respectively.
As for fixed rates exceeding one year, ME bumped two year rates on owner occupier loans by 10 basis points. Future homeowners and investors will face a 15 basis point increase on three year fixed mortgages. Its final rate adjustment will kick in on January next year, increasing the standard variable rate 10 basis points to 5.03%.
The provider listed funding costs and APRA’s limit on investor lending growth as key reasons for tweaking home loan interest rates.
“We believe these rate changes strike a fair balance between rising costs and the needs of depositors, borrowers and our industry super fund shareholders and their members,” said ME Bank CEO, Jamie McPhee.
This comes as Mozo’s database has seen 24 providers hike fixed interest rates on mortgages this month alone, despite the RBA having kept the cash rate on hold since August. Variable rate rises were less common in December, with only 11 providers announcing rate changes in comparison.
Prior to ME’s announcement yesterday, CommBank declared interest rate rises on Monday, making it the final big four bank to join the succession of rate rises.
According to Mozo’s Product Data Manager, Peter Marshall, home loan rates are expected to rise even more, so homeowners should consider locking their rates in for a suitable term.
“Borrowers should think carefully about how long they want to fix in their rates, because after the fixed term has ended, rates may be quite different than they are now,” he said.
With the sheer number of home loan providers offering a range of rates, those in the market for a new mortgage have plenty of choice. Here are the best fixed rates according to the Mozo database:
Top fixed rates for owner occupiers
- 1 year: 3.59% by Greater Bank
- 2 years: 3.64% by Homestar
- 3 years: 3.49% by My Credit Union
Top fixed rates for investors
- 1 year: 3.59% by Greater Bank
- 2 years: 3.69% by CUA
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