Which home loan lenders have passed on the RBA rate cut?
With the Reserve Bank of Australia cutting the official cash rate to a record low 2% at yesterday’s May board meeting, the question on everyone’s lips is - will home loan lenders follow suit? <<Update: To see which lenders have reduce rates after the RBA cut the official cash rate to 1.75% at the May 2016 board meeting, see here>>Out of the big four, so far ANZ has been the first to pass on the full rate cut, reducing its variable retail home loans by 0.25%, starting from Friday, 8 May. A quick turnaround considering past RBA rate cuts have shown many lenders take weeks to implement a rate reduction.
This will bring ANZ’s standard variable interest rate down to 5.38%, which the big bank says will save customers about $60 per month or $750 per year for the average home loan of $300,000.
The Commonwealth Bank has also passed on a rate cut to customers, however didn’t go as far as offering the full 25 basis point rate reduction, instead dropped its Standard Variable Rate (SVR) mortgage by 0.20% to 5.45%.
<<Update>> The National Australia Bank has also decided against passing on the full rate cut, instead reducing its Standard Variable Rate by 0.20% to 5.43%.
A handful of other lenders have dropped their rates by the full 0.25%, including:
- ING DIRECT from Friday 15 May, bringing the ING DIRECT Mortgage Simplifier to just 4.72%.
- ME Bank cutting its Standard Home Loan variable interest rate to 4.88% and its member package rate to 4.68% for home loans up to $500,000, starting 22 May.
- Loans.com.au reduced its Dream Home Loan Essentials to 3.98% effective immediately. However, the offer is only for new loans and applications already in progress. The lender says it will consider a rate cut for existing customers in the coming days.
- bankmecu will slash its standard variable home loan rate by 25 basis points on 15 May to 5.09%.
- Greater Building Society cut its Ultimate Home Loan (packaged variable loan) to 4.24%, its Great Rate (basic variable loan) rate to 4.64% and its standard variable rate to 5% effective immediately for new home loans. However, existing customers will have to wait until May 15.
Mozo will be keeping a close eye on the market and updating our naughty or nice table to show you the providers that have passed on the full RBA rate cut.