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In a sign that competition is starting to re-emerge in the market, another non-bank lender has launched a suite of products to rival the majors.
Yellow Brick Road will offer a standard variable rate of 6.34 per cent – 42 basis points lower than Westpac’s standard variable rate.
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The new home loan products will be administered by Gateway Credit Union.
Paul Thomas, CEO of Gateway believes the new Yellow Brick Road home loans will give Australians access to greater choice.
“We have been in the mortgage business in Australia for more than fifty years, and we believe that the combination of our balance sheet and back office capabilities with Yellow Brick Road’s brand and distribution network is a fantastic development for Australian home buyers,” he said.
“This kind of competition is what’s needed in today’s marketplace in order to maintain downward pressure on fees, charges and rates.”
Although the lender does not distribute through the broker channel, the launch of another competitive standard variable rate product highlights the growing number of non-bank lenders willing to challenge the majors for market share.
“With interest rates on the way back up, new lenders like us need to enter the market in order to keep the big banks honest and ensure that there’s strong competition in the marketplace,” the company’s executive chairman Mark Bouris said.
“Increased competition will mean that the big banks will have to think twice about raising interest rates beyond the official rate or risk losing market share to us.”
