ANZ today announced an update on variable home loan and business loan interest rates.
Principal and interest owner-occupier home lending
- Variable interest rates for the 80% of owner-occupier borrowers who repay principal and interest on their standard variable home loan remain unchanged at 5.25%pa.
Investor home lending
- The variable interest rate paid by property investors will increase by 0.25%pa from 5.60%pa to 5.85%pa effective 31 March.
Interest-only home lending
ANZ will introduce new variable interest rates for customers choosing to pay interest-only on their home loans.
- New lending. From 22 April, variable interest rates for new investor and owner-occupier home loan customers who choose to repay interest-only will increase.
– Investor variable rate home loans (interest only) will increase by a further 0.11%pa from 5.85%pa to 5.96%pa.
– Owner-occupier variable rate home loans (interest only) will increase by 0.20%pa from 5.25%pa to 5.45%pa.
- Existing lending. From late July, increases applied to new lending will apply to existing investor and owner-occupier variable home loan customers who choose to repay interest-only. ANZ will be writing to existing interest-only variable home loan customers from May to provide them with advance notice of the change and the option of switching to repay principal and interest on their loan at a lower interest rate without incurring a fee.
- For business borrowers, business variable rate indices will increase by 0.08%pa.
ANZ Group Executive Australia Fred Ohlsson said: “We are pleased to be in a position to keep rates unchanged for the 80% of owner-occupier home borrowers who pay principal and interest on their loan.
“This is a clear signal that we are open for business for Australians either looking to buy a home or looking for a better deal.
“The changes we are making in home lending affect investors and borrowers who only repay interest on their loan. These changes reflect a need to closely manage our regulatory obligations, our portfolio risk and the competitive environment.
“We recognise the day-to-day challenges that home-owners face with their house-hold budgets. We believe this is a balanced decision that reflects the range of regulatory and risk factors, and the pressures on family budgets.
“This is why we are providing our customers with interest-only home loans additional notice and the option to switch to repaying principal and interest to take advantage of the lower rate,” Mr Ohlsson said.