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CUA has unveiled a new variable home loan product with a 4.65 per cent 'ongoing' rate and a 100 per cent offset facility.
Although other lenders have recently unveiled similar variable rates, those were temporary discounts, whereas the Fresh Start product is a ‘permanently discounted’ rate.
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Fresh Start product applies to new lending with a maximum LVR of 80 per cent.
It has no establishment free, comes with free redraw and allows borrowers to make extra repayments without penalty.
CUA’s general manager of sales & service, Darrin Northey, said brokers had asked CUA to increase its variable rate offering.
“All the feedback we’ve had from brokers is that this will have an enormous amount of cut-through,” he told The Adviser.
Mr Northey said that was partly because the “incredibly sharp” 4.65 per cent rate is permanent rather than an introductory offer designed to win new business.
He added that Fresh Start had been launched in response to the increasing number of borrowers who are looking to refinance.
Brokers and borrowers are becoming more receptive to mutual banks like CUA, according to Mr Northey.
“There is big demand for competition in the marketplace. Brokers are receiving lots of feedback from their customers about wanting to look at alternatives rather than just the big banks,” he said.
[Related: Brokers key to our record volumes, says CUA]
The Adviser has explored the mutual bank sector in greater detail in its August issue, which is out now
