A major bank has lowered home loan rates across the board ahead of tomorrow’s widely anticipated official cash rate (OCR) cut.
BNZ said there were 20% more customers applying for home loans in the six months to April, as compared to the same period last year.
The bank’s standard six-month fixed rate dropped from 5.49% to 5.35%, while the one-year rate fell from 4.99% to 4.95%.
Its 18-month term fell from 4.95% to 4.89% and two-year term fell 4 basis points to 4.95%.
The three-year term fell 20 basis points to 5.09%, four-year fell 30 basis points to 5.39% and the five-year rate fell 20 basis points to 5.59%.
BNZ offers the same rates to those with 20% equity and those without – but those with less than 20% equity will pay a low equity premium.
Variable rates have also been cut.
The bank’s home lending general manager James Leydon said the bank was confident to pass on savings because a cut from the Reserve Bank was widely expected tomorrow.
The changes to mortgage rates follow a cut in term deposit rates at BNZ earlier in May.
The bank lowered rates across various investment periods, with savers seeing the one-year term deposit rate fall to 3.90%.
Leydon said of today’s change: “We know many of our customers are looking beyond the very short-term fixed rates as the interest rate environment evolves.
“By cutting our fixed rates across all terms, we’re giving customers more choice and the ability to lock in a competitive rate for a longer period.
“Lower interest rates should also help relieve some pressure on household budgets by making borrowing more affordable.”
The Reserve Bank will announce its OCR decision tomorrow, with economists widely expecting another 25 basis point cut.
