BNZ has announced a market leading low two-year carded home loan rate.
The new 'special' is 5.15%.
This easily beats rates offered by their main rivals.
It is also lower than the rate offered by SBS Bank, which for more than a month has been the lowest two year rate offer in the mortgage market.
BNZ was one of the first banks to withdraw their cash incentive offers, so presumably this gives them some flexibility to push those benefits into lower rates.
The BNZ 'special' is available for customers who have at least 20% equity in the property provided as security. To be eligible, clients must have a transaction account with BNZ with their pay credited to this account.
Instead of a cash incentive, this BNZ offer comes with bonus 5,000 Fly Buys points with any new lending over $250,000.
The new 2 year 'special' rate of 5.15% is -24 bps lower than BNZ's standard rate for this term. It is also the same advantage over ANZ, ASB, Kiwibank and Westpac.
It is effective and available today but is only scheduled to last for a week. It expires Friday April 17. Today's changes and follow rate cuts by ASB late yesterday.
See all banks' carded, or advertised, home loan rates here.
The current non-rate incentive offers are here.
This is how mortgage rates from the banks compare at 9am Friday, April 10, 2015:
| below 80% LVR | 1 yr | 18 mths | 2 yrs | 3 yrs | 4 yrs | 5 yrs |
 |
5.49% | 6.09% | 5.39% | 5.79% | 6.49% | 5.89% |
 |
5.59% | 5.70% | 5.39% | 5.45% | 5.99% | 5.65% |
 |
5.49% | 5.15% | 5.55% | 5.65% | 5.75% | |
 |
5.69% | 5.39% | 5.55% | 5.99% | 5.79% | |
 |
5.99% | 6.09% | 5.39% | 5.59% | 6.49% | 5.75% |
 |
5.59% | 5.49% | 5.39% | 5.59% | 5.75% | 5.79% |
 |
5.29% | 5.29% | 5.29% | 5.29% | 5.29% | |
| SBS Bank | 5.59% | 5.74% | 5.19% | 5.49% | 4.99%* | |
 |
5.70% | 5.80% | 5.35% | 5.60% | 6.40% | 5.85% |
* Members only, otherwise 5.79%
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10 Comments
Borrowers still wary of long term fixed mortgages due to "break fees" threat.
http://www.stuff.co.nz/business/money/67666300/poor-takeup-of-long-term-mortgages
I wonder that that doesnt show a mis-conception? Lets say we see GFC2 what can the RB do? lets say drop, an OCR of 1% is the result. Can the banks get funding that cheaply? in fact if foreign investors become risk adverse would wholesale rates go up? So what will ppl save? 1%? What happens to retail rates if banks cant get enough private funding?
Steven - you questions are the right ones - an OCR at 1% certainly won't give the banks anywhere near that rate. But currently they're very long-term funded so nowhere near the GFC1 situation, and what they are having to rollover is coming in well below the average spread over the past 7 years hence the falling rates. But ultimately when that fully runs off, if we have a GFC2, unless the compartive offshore cash rates are at minus 2 or 3% at that point, youre going to have bank spreads through the roof, the NZD at 0.3500, and imported costs through the roof, and eventually much higher rates.
If the interest rate is already low eg 5% then it can't go down much further (ie it won't go down more than 5% :) ) and a 1% drop shouldn't create that much difference going down.
And there is no break fee to shift up to a more expensive rate, so if you do 5.3% for 7yrs, 2yrs in you want to refinance for a 10yr fix it will only cost you if it has dropped under 5.3%... and then the cost is pro-rata for the amount saved. So if you get to 5yrs out of 7yrs, and you think a huge rise is imminant in 3 years time, then you've already saved plenty, just re-lock to whatever the bank will deal with on the day.
The higher the interest rate the more expensive it is to break, so as long as your budget can handle it, attempting brinkmansehip to find the ultimate low interest really won't save a fortune, and if you're that exposed you're probably i bad territory anyway and should be re-examining your whole strategy.
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