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Home loan rate wrap: Teachers Mutual Bank drops fixed investor rates

Last week saw Teachers Mutual Bank and its division UniBank cut rates on a number of investment home loans by 20 basis points, while MyState hiked rates on a variety of interest-only loans.

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Each of Teachers Mutual Bank’s fixed investment products, from one-year to five-year, experienced this cut. UniBank, which is a division of Teachers Mutual Bank, carried out the same rate cuts to all of its fixed investment products.

Both providers also cut the variable investment product, the Flexi Choice Investor Home Loan, by 20 basis points.

Canstar’s Group Manager of Research and Ratings, Mitch Watson, said these changes move both Teachers Mutual Bank and UniBank’s investment fixed rates below their respective market averages.

Teachers Mutual Bank & UniBank’s new investment home loan rates

Fixed

Rates based on fixed investment home loans available in NSW for a loan amount of $350,000 at 80% LVR (principal & interest). Table sorted by current rate (lowest-highest).

Variable

Rates based on variable investment home loans available in NSW for a loan amount of $350,000 at 80% LVR (principal & interest). Table sorted by current rate (lowest-highest).

MyState increases rates on owner-occupier loans

There were a total of five different institutions that either increased or decreased home loan interest rates last week: UniBank, Teachers Mutual Bank, Summerland Credit Union and The Rock.

Summerland Credit Union and The Rock only made one change each:

  • Summerland Credit Union decreased the rate on its Standard Fixed 3 year home loan by 20 basis points;
  • The Rock increased the rate on its  Basic Investment Variable Home Loan (interest-only) by 20 basis points

MyState meanwhile made five product changes. Most notably, it increased interest rates on three of its variable owner occupier loans by 20 basis points.

“We have observed that across the market, lenders are adjusting their pricing between the payment option borrowers choose,” Mr Watson said.

“They are offering lower interest rates on principal and interest repayments as an incentive for consumers to choose this option over the relatively more expensive interest rate on an interest only loan. The movement by MyState of increasing their loan interest rates for interest only by 20 basis points is a reflection of this.”

Rates based on variable owner-occupier home loans available for a loan amount of $350,000 at 80% LVR (principal & interest). Table sorted by current rate (lowest-highest).

Summary: Home loan rate changes (01/05/2018 to 08/05/2018)

The following table displays a complete summary of the home loan product changes tracked by Canstar last week.

Home Loan Product Level Changes between 01/05/2018 to 08/05/2018 (%)
Company Product  Old Rate New Rate Change Comparison Rate*
Owner Occupier Home Loans
Variable
MyState  Basic Variable Home Loan IO 3.99 4.19 0.2 4.22
MyState Special Residential Home Loan IO 4.19 4.39 0.2 4.44
MyState Standard Variable IO 5.43 5.63 0.2 5.7
Fixed
Summerland Credit Union Standard Fixed 3 yrs 4.09 3.89 -0.2 4.88
Investor Home Loans
Variable
MyState Inv Standard Variable IO 5.43 5.63 0.2 5.7
MyState Special Residential Inv Loan IO 4.69 4.89 0.2 4.94
Teachers Mutual Bank Inv Flexi Choice 5.36 5.16 -0.2 5.21
The Rock Inv Basic Variable Home Loan IO 4.49 4.69 0.2 4.72
UniBank Inv Flexi Choice 5.36 5.16 -0.2 5.21
Fixed
Teachers Mutual Bank Inv Fixed Rate 1 yr 4.34 4.14 -0.2 5.11
Teachers Mutual Bank Inv Fixed Rate 2 yrs 4.43 4.23 -0.2 5.04
Teachers Mutual Bank Inv Fixed Rate 3 yrs 4.6 4.4 -0.2 5.01
Teachers Mutual Bank Inv Fixed Rate 4 yrs 4.88 4.68 -0.2 5.04
Teachers Mutual Bank Inv Fixed Rate 5 yrs 5.01 4.81 -0.2 5.06
UniBank Inv Fixed Rate 1 yr 4.34 4.14 -0.2 5.11
UniBank Inv Fixed Rate 2 yrs 4.43 4.23 -0.2 5.04
UniBank Inv Fixed Rate 3 yrs 4.6 4.4 -0.2 5.01
UniBank Inv Fixed Rate 4 yrs 4.88 4.68 -0.2 5.04
UniBank Inv Fixed Rate 5 yrs 5.01 4.81 -0.2 5.06
Rates based on loans available for $400,000 at 80%LVR. *Comparison rate based on a loan amount of $150,000 over 25 years.

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