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A big four bank has announced that it has increased its fixed rates by 10 basis points, “bucking the trend” of other lenders decreasing rates.
ANZ has announced that it has increased its two-year fixed home loan rate for owner-occupiers paying principal and interest by 10 basis points.
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The bank’s two-year Fixed Home Loan rate has increased from 2.34 per cent to 2.44 per cent (comparison rate 4.10 per cent), effective from 22 May 2020.
Further, ANZ Breakfree packages now start from 2.29 per cent (comparison rate 4.02 per cent), also dropping by 10 basis points.
The bank made note that any two-year fixed rate loan that has been applied for prior to 22 May but not yet drawn down will have the new rate applied, bar those loans with a Lock Rate Facility in place.
The news comes following reports of a “blow-out” in ANZ’s turnaround times, with data from the bank revealing that mortgage applications are taking up to 23 days for approval.
On average, ANZ requires between 15 to 18 business days from the day of application to approval.
In a statement issued to The Adviser, ANZ denied that the increase is linked to “processing issues” within the bank, instead attributing the deterioration to “record daily volumes”.
Last month, ANZ’s CEO told The Adviser that home loan volumes had risen sharply off the back of the COVID-19 crisis, driven by a surge in refinance applications.
“What we’ve seen surprisingly in the last six weeks is a significant uptick in home loan applications coming through to ANZ,” he said at the time.
NAB lowers fixed rates for investors
Meanwhile, NAB has reportedly decreased its fixed rates by between 0.20 and 0.60 percentage point for investors paying interest-only.
Commenting on the recent rate changes, Steve Mickenbecker of Canstar said: “Home loan interest rates have been decreasing for some time now, but ANZ is bucking the trend today by increasing its lowest fixed rate offer from 2.19 per cent up to 2.29 per cent.
“The rate increase looks more a fine-tuning than anything else, moving ANZ into line with the 2.29 per cent lowest fixed rate offers at its major competitors.”
Mr Mickenbecker continued: “At the same time, NAB has slashed its interest-only investment lending fixed rates by up to 0.60 [percentage point]. NAB’s interest-only investment package rate for three years fixed is down to 2.69 per cent, only 0.10 [percentage point] above the principal and interest rate.
“The move is quite a repositioning, with NAB’s three-year interest-only rate for investors only 0.40 [percentage point] above the 2.29 per cent for owner-occupiers making principal and interest repayments.
“The battle for investment lending is well and truly on,” he concluded.
[Related: ANZ strained by mortgage inflows as turnaround times spike]
