Home loan rate changes are moving fast today (Monday). And it is not the majors who are setting the pace, it is the challenger banks.
Hot on the heels of SBS Bank releasing market-leading fixed mortgage rates, now Heartland Bank has gone even lower.
Their latest offer is just 1.99% for one year fixed.
Also on offer are two year or three year fixed term options, for 2.35% and 2.45% respectively. These are -90 basis points, -62 bps and -94 bps reductions respectively from their previous levels.
All these three new fixed rates are now market-leading.
And they have cut their floating rate as well, taking it down to 2.95% and well below the Kiwibank 3.40% level, which until today was the lowest floating rate in the market. For Heartland, this is a -1.00% reduction from their previous offer.
Heartland re-entered the market in March 2020 with a digital, self-serve offer where customers could apply and receive approval without needing to make an appointment, visit a broker, or arrange a house call. In this trial, all available funds were approved within a month of the launch, demonstrating that their ‘do-it-yourself’ online offering had market appeal.
“Digitalisation means a low cost of onboarding, which can be passed on to borrowers. It also means speed – an answer can be given in minutes, so customers don’t have to endure the lengthy processes of mainstream banks. Moreover, Heartland’s group structure provides it with broad funding flexibility,” said Heartland Group CEO Jeff Greenslade.
To be eligible for Heartland Home Loans, customers must be refinancing or purchasing a standalone house on a single section in a major New Zealand centre, have a deposit or equity of at least 20% and intend to live in the home.
This offer is described as being "available for a limited time". They are not available for new-build projects.
To be eligible for a Heartland Home Loan you also need your income paid into a Heartland YouChoose Account. And, existing Heartland home loan customers will not automatically be moved across to a Heartland Home Loan. However, anyone who meets the eligibility requirements is welcome to apply, including their customers with an existing home loan.
Details of the new low SBS Bank fixed rate reductions are here.
One useful way to make sense of these new lower home loan rates is to use our full-function mortgage calculators.
And if you already have a fixed term mortgage that is not up for renewal at this time, our break fee calculator may help you assess your options.
Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at this time.
|Fixed, below 80% LVR||6 mths||1 yr||18 mth||2 yrs||3 yrs||4 yrs||5 yrs|
|as at October 12, 2020||%||%||%||%||%||%||%|
|Bank of China||3.45||2.55||2.65||2.65||2.75||2.85||2.95|
|China Construction Bank||4.70||2.65||2.65||2.65||2.80||2.89||2.99|
|[incl Price Match Promise]||2.89||2.49||2.65||2.65||2.79||2.99||2.99|
In addition to the above table, BNZ has a unique fixed seven year rate of 5.20%.
* TSB also offers all fixed rates below 3% too, but that is only via their Price Match Promise.