Strategic rate reduction by BNZ and TSB starts today
As the financial market anticipates a reduction in the OCR by the Reserve Bank (RBNZ) this week, the Bank of New Zealand and TSB have decreased their home loan rates, boosting buyer options and market activity.
BNZ lowers six-month home loan rate
BNZ has lowered its six-month fixed home loan rate to 5.89% p.a., effective today, aiming to enhance its position in the competitive mortgage market.
Karna Luke (pictured above left), BNZ’s executive of customer products and services, has noted a significant shift among borrowers towards shorter-term loan options.
“Over the past six months, we’ve seen a spike in customers opting for shorter terms, with approximately 60% choosing to float or fix for six-month terms,” Luke said.
This rate reduction is poised to attract customers seeking to benefit from the declining interest rate environment.
The new rate is available starting today for both new and existing customers via BNZ’s online channels and app.
Alongside the rate cut, BNZ, which also anticipates RBNZ to lower its cash rate by 50 basis points to 3.75%, at today’s meeting, has seen a rise in home loan activities, with more people seeking pre-approval for home loans.
The revised six-month fixed home loan rate is now accessible to all eligible new and existing customers.
BNZ maintains strict lending criteria, including terms, fees, and minimum equity requirements. An establishment fee of up to $150 may be applied.
TSB slashes mortgage rates before expected OCR cut
TSB Bank has also reduced several of its mortgage rates ahead of the widely expected OCR cut today, 1News reported.
Effective yesterday, TSB’s one-year fixed home loan rate has been reduced to 5.35%, the lowest among major banks. Furthermore, TSB has decreased its six-month rate to 5.89%, its 18-month rate to 5.49%, and its two-year rate to 5.29%.
Penny Burgess (pictured above right), TSB’s general manager of customer delivery, commented on the rate cuts.
“We’re pleased to offer some mortgage rate relief for New Zealanders in what’s been a tough year,” Burgess said.
