Westpac has announced a series of mortgage rate cuts to attract new borrowers, as it seeks to continue to grow its portfolio, leveraging lower funding costs, and the war chest it accumulated earlier in the year from back book repricing, following APRA’s tightening of underwriting standards and restrictions on interest only loans.
Westpac and its subsidiaries have announced a number of rate cuts on select fixed rate mortgages for a limited time.
The changes will bring in lower rates on owner occupier and investor products and increase the introductory discounts on certain loans.
From last Friday (1 December), St George, Bank of Melbourne and BankSA have brought in the following rates for new lending:
| Current Advantage package rate (p.a.) | Change (p.a.) | New promotional rate (p.a.) | ||
| 2 year fixed owner occupier | Principal & interest | 3.85% | -0.06% | 3.79% |
| Interest only | 4.24% | -0.15% | 4.09% | |
| 2 year fixed residential investment | Principal & interest | 3.99% | -0.10% | 3.89% |
| Interest only | 4.49% | -0.40% | 4.09% | |
| 3 year fixed owner occupier | Principal & interest | 3.94% | -0.05% | 3.89% |
| Interest only | 4.34% | -0.15% | 4.19% | |
| 3 year fixed residential investment | Principal & interest | 4.19% | -0.20% | 3.99% |
| Interest only | 4.49% | -0.30% | 4.19% |
Basic owner occupier principal & interest promotional rates have also been reduced across Westpac’s subsidiaries as follows:
| Basic owner occupier P&I | Old rate (p.a.) | Change | New rate (p.a.) |
| St George | 3.78% | -0.10% | 3.68% |
| Bank of Melbourne | 3.78% | -0.14% | 3.64% |
| BankSA | 3.78% | -0.14% | 3.64% |
Westpac itself also brought in a number of changes, effective from 4 December on new lending, by increasing the two-year intro discounts on its two and three year fixed option home and investment property loan rates.
| Product | Repayment | Current rate (p.a.) | Change | Promotional rate (p.a.) | Promotional comparison rate (p.a.) | |
| 2 year | Fixed options home loan | P&I | 3.88% | -0.09% | 3.79% | 4.86% |
| IO | 4.39% | -0.30% | 4.09% | 5.38% | ||
| Fixed rate investment property loan | P&I | 4.19% | -0.30% | 3.89% | 5.31% | |
| IO | 4.59% | -0.50% | 4.09% | 5.75% | ||
| 3 year | Fixed options home loan | P&I | 3.99% | -0.10% | 3.89% | 4.82% |
| IO | 4.49% | -0.30% | 4.19% | 5.32% | ||
| Fixed rate investment property loan | P&I | 4.24% | -0.25% | 3.99% | 5.23% | |
| IO | 4.59% | -0.40% | 4.19% | 5.64% | ||
The bank has also increased the two-year offer discount on its flexi first option home for principal and interest repayments from 0.84% p.a. to 1.00% p.a. putting the current two-year introductory rate at 3.59% p.a.
A Westpac spokesperson said the bank was pleased to launch these competitive rates for new lending across the group to support Australians purchasing a new home in a responsible manner.
“We know many Australians begin thinking about purchasing a new home as the year draws to a close and they look ahead to the new year and a fresh start.”
