Competition and Low Home Loan Volume Growth Sees Banks Offering Special Rates: Many As Low As 6%
Luckily I have fixed my mortgage before the hype about rate rises became mainstream, I can thank our in house mortgage adviser for that!
Many of us did fix our interest rates in time, before the hike however those that didn't, well it seems that you didn't miss the boat so to speak, in fact you may be better off fixing now than a few months ago.
Westpac has recently announced a mortgage rate change, a one year home loan 'special' of 5.95%, down from 6.09%. Then ASB announced their one year 'special' on Monday at the 5.95% level.
ANZ says it's launching a 6.09% two-year, fixed-term home loan interest rate offer, undercutting carded, or advertised, two-year rates from the other big banks. ANZ says the offer will be made for a limited time and will see customers offered up to $3,000 cash for new lending of $250,000 or more.
Currently, now only two banks are offering a one year rate of 6% or higher. Every other bank is below 6% for that fixed term.
It all sounds very attractive, but of course these special rates come with conditions, usually requiring 20% equity. Furthermore, the cash offers and sweeteners banks do offer with their rates do not work out more financially attractive in the long run compared to a bank offering a more competitive rate over the long run.
As a rule of thumb I always choose to fix the majority of my home loan for a 1-2 year period depending on what the OCR is doing and researching what the interest rate trend has been over a 5 year period.