As expected Westpac today announced changes to interest rates across a range of variable lending products for home owners and investors.
- Variable home loan rate for owner occupiers will increase by 0.03% to 5.32% per annum for customers with principal and interest repayments1;
- Variable home loan rate for owner occupiers will increase by 0.08% to 5.49% per annum for customers with interest only repayments;1
- Variable residential investment property loan rate will increase by 0.23% to 5.79% per annum for customers with principal and interest repayments1; and
- Variable residential investment property loan rate will increase by 0.28% to 5.96% per annum for customers with interest only repayments1.
George Frazis, Chief Executive of Westpac Consumer Bank, said today’s decision takes into account a number of economic and regulatory factors.
“Today’s changes are in response to increasing funding costs. Despite home loan interest rates being at historically low levels, both deposits and wholesale funding of mortgages have increased over the last nine months.
“We understand the significance of interest rate changes to our home loan customers, so we take a very careful approach to these decisions,” Mr Frazis said.
“We try to balance the needs of both owner occupiers and investors in making these decisions while continuing to provide customers with a competitive offering across our range of products.
“Importantly, we are offering lower interest rates to customers who make principal payments to encourage customers to pay down their home loan in this low interest rate environment.”
Customers with interest only home loans who wish to move to principal and interest repayments can do so without paying a switching fee until 17 June 2017.
Variable lending products for small businesses will also increase by 0.08%2.
1 Changes are effective 24 March 2017.
2 Changes are effective 3 April 2017.