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Reductions to fixed mortgage rates keep coming as banks vie for attention in a competitive market

Reductions to fixed mortgage rates keep coming as banks vie for attention in a competitive market

TSB Bank has cut a key mortgage rate.

According to the bank's website, it's pricing its fixed two year 'special' at 4.29%, down -10 basis points from 4.39%, effective Friday (January 22).

This is the lowest carded two year rate on offer from a bank.

TSB hasn't changed any other rate.

For the two year term, it has pipped SBS Bank by -6 bps, and the most competitive main banks (BNZ and Westpac) by -10 bps.

The TSB Bank conditions have an upper LVR limit of 80%, meaning borrowers need a deposit or equity of at least 20%. The offer is available until February 29, and no application fee is required by the bank.

In addition, TSB is adding a new non-rate incentive: an Air New Zealand Mystery Break for two. The fine print says:

Return domestic air travel (Seat & Bag) on Air New Zealand; A rental car with unlimited kilometres; Two nights’ 4-5 star accommodation at your mystery destination. Deluxe Mystery Break packages are non-transferable and are subject to Air New Zealand’s ‘Deluxe Mystery Break’ terms and conditions. Package will be supplied as a voucher and is valid for travel within twelve months from date of issue.

Mortgage rates now compare across all banks as follows:

below 80% LVR  1 yr  18mth  2 yrs   3 yrs  4 yrs  5 yrs 
  % % % % % %
4.39 4.95 4.49 5.10 5.25 5.35
ASB 4.39 4.49 4.49 4.75 5.15 5.25
4.39 5.09 4.39 4.49 5.40 5.50
Kiwibank 4.49   4.49 4.85 5.25 5.35
Westpac 4.39 4.95 4.39 4.80 5.25 5.35
             
4.39 4.49 4.49 4.75 4.99 5.15
HSBC 4.25   4.49 4.99 4.99 4.99
HSBC 4.35 4.35 4.35 4.65   5.29
4.35 4.69 4.29 4.79 5.35 5.35

In addition, BNZ has a fixed seven year rate of 5.90%, while TSB Bank offers a fixed ten year rate at 5.75%.

Fixed mortgage rates

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7 Comments

Interesting times...

I need to make a decision by 6pm tonight

Thoughts / opinions on:
Floating
6 months
1 year
2 year

ps, you will be personally held responsible :)

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Floating for then next 2 months or so. Keep scanning for best 6 month / 12 month or 2 year rate.

What do you have to lose? Only 1.2%/12 each month.

Or: Whichever is the cheapest rate right now. What's wrong with short term savings?

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Am leaning towards fixing for 6 months, purely based on what I've been reading here, ie/ probability of rates dropping further. Otherwise I'd be doing my standard 2 year fix

Cheers

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Don't do anything based on what you read here. These guys would have told you to sell your house in 2007 before the 'eminent crash' ;)

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Indeed, a very valid response :)

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A quick message from Uranus: All options are historically good - fix or float and you'll be sweet.

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That is brilliant Jimbo, you are so right. I like Interest.co but the doom merchants who have been predicting the end is nigh dates back way before 2007. I often wonder how many people were put off buying a home based on the doom time drival often seen here and will never be able to buy a home in Auckland as a consequence. Hopefully its not too many. Auckland and NZ is one of the safest and beautiful places in the world to live, reality is we will always have people coming to live here mainly in Auckland. There will be no property crash, yes it may come back a bit or level out but lets face it - what a great place to be live in.

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