MOVE Bank cuts home loan rates, but are Aussies still keen on switching?
Tuesday 21 January 2020
Whether you’re thinking of adding another investment property to your portfolio or are looking to snatch up your first home this year, the latest decision from MOVE Bank may be welcome news for you.
Effective today, the lender has cut its three-year fixed rate Ultra Low Lockit loan by 24 basis points, bringing the rate down to a competitive 2.74% (3.82% comparison rate*) which sits well below the average three-year fixed rate in the Mozo rate of 3.20%^.
But that wasn’t all. MOVE Bank also unveiled some new rates for investors, reducing its Straightforward Investment Loan by 30 basis points, with the new rate now sitting at just 3.09% (3.12% comparison rate*).
And if you're a new customer and submit your application before 29 May 2020, MOVE Bank will give you $1,000 cashback, which will be deposited into your MOVE Bank Everyday Saver or Express Saver account!
The lender has also added an interest-only option to their Straightforward Investment Loan, with the rate sitting at 3.29% (3.32% comparison rate*), however this loan is only available to investors borrowing below 75% of the property’s value.
The news comes just days after online lender Well Home Loans announced it would be making adjustments to its fixed and variable rates, which saw them take out the title of lowest three-year fixed rate in the Mozo database at a jaw-dropping 2.68% (2.74% comparison rate*).
Refinance activity drops, says Australian Bureau of Statistics (ABS)
Despite the ongoing rate war between lenders, it seems that not all Aussies are jumping at the chance to score a better deal.
Recent figures from the Australian Bureau of Statistics (ABS) reveal that the number of Aussies refinancing their home loans has fallen by 2% from $9.83 billion to $9.63 billion in November (seasonally adjusted).
Owner-occupiers accounted for the majority of the decline with a reported 2.6% decline in switching, while investors only experienced a 1.2% decline.
But according to Mozo’s home loan expert, Steve Jovcevski, this refinance ‘slump’ may only be temporary.
“With the back-to-back rate cuts in June and July, I suspect that home owners aren’t feeling as motivated to switch (in November), as they would have already received a cut from their current lender,” he said.
“Additionally, lenders may also be pulling out all stops to retain customers, since it’s cheaper to keep a customer than it is to gain a new one - they may even be matching the rates of other lenders their customers are considering.”
“However, with another potential cut in February, I expect that this slump will stop and refinancing will resume again.”
So if you’d like to find out if you could be on a better home loan deal, make your next stop our home loan refinance comparison tool.
^As at 17 January, 2020