Aussie Home Loans slashes fixed rate
Thursday, October 20, 2011
The gap between fixed rates and standard variable rates continues to grow with Aussie Home Loans slashing its 3-year fixed rate to 6.29 per cent p.a., which is considerably lower than the average advertised standard variable rate (SVR) of the 4 major lenders at 7.8 per cent p.a.*.
The Reserve Bank would have to cut rates six times (based on 0.25 per cent cuts) for SVRs to be competitive with the current fixed rate being offered by Aussie. Aussie's Founder and Executive Chairman, Mr John Symond said the time was right for homeowners to consider locking in at least part of their mortgage, as the current fixed rates were extremely competitive.
"Over the years I have advised people to stick with variable and pay off as much as you can in order to pay the loan off faster," he said. "However, with these competitive rates, it makes sense to lock away part of your loan as an insurance policy against global uncertainties," he added.
Mr Symond said there was speculation the RBA would drop its rates at its next meeting on Melbourne Cup day (Tuesday, November 1), but it would have to keep dropping consistently each month to match Aussie's fixed rate.
"The cost of funding is quite high and while the current round of aggressive fixed rates may be good news for consumers, they may not last forever so it pays to look at your home loan now," he said.
Mr Symond added that it was prudent to speak to an Aussie broker, who can assist homeowners with a tailored solution by splitting the loan between a fixed and a competitive variable interest rate.
"In just 15 minutes a broker can research hundreds of loans, where it might take a homeowner months to find the same information from the host of lenders in the market and the service is free," he said.
As one of the country's largest non-bank providers of financial services, Aussie has a loan book worth more than $40 billion, with more than 700 brokers across the country.
An Aussie broker will offer guidance, assess eligibility, lodge the application and then support the first home buyer borrower or refinancer through the home loan process. Aussie brokers are available seven days a week in your home or at one of our 140+ stores at the request of customers who call Aussie on 13 13 33.
*Based on the advertised SVR's of ANZ, CBA, ANZ and Westpac on a $300k mortgage over 30 years as at 19 October 2011.
For further information please call:
Brooke Stoddart
Aussie
(02) 8297 0381
Tim Allerton
City PR
0412 715 707