Westpac & Co-op Bank cut fixed term mortgage rates

Westpac takes 6-16 basis points off its fixed term home loan rates, while Co-op Bank shaves off a similar amount as it re-aligns itself for the 2nd time since the OCR cut two weeks ago

23rd Mar 16, 11:59am by Jenée Tibshraeny

Westpac is lowering its fixed term mortgage rates further to the Reserve Bank cutting the Official Cash Rate on March 10, while the Co-operative Bank is undergoing a second round of reductions.

Co-op's 5-year rate is now leading the market with Kiwibank, HSBC and SBS Bank at 4.99%. However, HSBC's 4.99% rate is only available to its "premier" customers, and SBS' requires borrowers to have 20% equity.

The changes are as follows:

Westpac
Fixed term	New rate	Change (bps)
1 year	4.79%	-6
1 year Special <80% LVR	4.25%	-14
2 years	4.89%	-10
2 year Special <80% LVR	4.39%	-10
3 years	4.99%	-11
4 years	5.09%	-16
5 years	5.19%	-16

Co-op Bank
Fixed term	New rate	Change (bps)
1 year	4.25%	-14
18 months	4.35%	-4
2 years	4.35%	-4
3 years	no change	no change
4 years	4.89%	-10
5 years	4.99%	-16

Co-op cut its floating rate by 25 basis points to 5.45% straight after the OCR move. Westpac soon followed, but dropped its floating rate by only 10 basis points to 5.75%.

ANZ, ASB, BNZ and Kiwibank have already dropped their fixed mortgage rates since the latest OCR cut. And the Co-operative Bank cut its two and three year rates as recently as March 15 by 10 basis points each to 4.39% and 4.65%, respectively.

See this page for all banks' carded, or advertised, mortgage rates.

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8 Comments

by Boatman | 23rd Mar 16, 4:56pm 1458705418

WHY NO CHANGES TO THE FLOATING RATE .............. YA B@ST@RDS ?

by Justice | 23rd Mar 16, 5:30pm 1458707453

I was thinking about this today Boatman. About how every single dollar in our pockets no matter where you spend it, put it, draw it, send it....ends up back at the greedy banks, and it makes no difference which bank as they all feed off each others balance sheets.

Banks are quite simply the most prolific parasitic organism at the very heart of our monetary and financial systems and they are holding back human progress. There must be a better way.

by scarfie | 23rd Mar 16, 6:07pm 1458709671

Long term investing today is different than ever before. Hoard cash is the trick, as that sits as a liability on the banks balance sheets. Spend less, which contracts the money supply via lowering velocity. All these thing reinforce the downward spiral of deflation, which increases the value of your cash.

by Dezo | 23rd Mar 16, 6:01pm 1458709271

TSB today offered me:
6mth- 4.35% or 1 yr - 4.10%

by MortgageBelt | 23rd Mar 16, 6:01pm 1458709313

The very high so called 'floating rate' is intended to be at very high levels to shift borrowers onto fixed rates.
Once borrowers are on fixed, then banks achieve lock-in, and benefit from having borrowers locked on relatively higher rates as generally rates and the OCR decrease. E.g. Those who fixed at 5.5% 2 years ago....

by Zoltuger | 24th Mar 16, 11:14am 1458771246

Faster repayments are more restricted under a fixed than a floating mortgage. Westpac only allows 20% above the minimum repayment on a fixed term. Lower interest rates means lower minimum payment, meaning a greater restriction on the amount you can pay faster.

by CJ099 | 23rd Mar 16, 7:38pm 1458715124

Of courser they are lowering the rates, the banks wouldn't want us to get wise about Asia Overseas Investors having left a bit gap in the market place, so that NZ buyers will need to borrow more to maintain the current exceedingly hugley over inflated house prices in Auckland and Queenstown.

by KH | 23rd Mar 16, 10:44pm 1458726264

These are advertised rates. But Westpac does lower all the time.