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One lender has cut its fixed rates “to keep one step ahead of the competition”.
Australian First Mortgage will reduce the three-year rate on its Flexible Option product range as of May 15.
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The full-doc product will fall from 5.19 per cent to 5.09 per cent, while the low-doc option will fall from 6.29 per cent to 6.19 per cent.
AFM will also lower the two-year fixed rate on its Complete/Alliance product range as of May 12.
Rates will be reduced from 4.83 per cent to 4.78 per cent.
It comes after lenders told The Adviser earlier this month that the raft of rate cuts in 2014 had been prompted by strong competition.
AFM managing director Tanya White said the rate reviews were part of the lender’s normal pricing activity.
“AFM is always looking for opportunities to review its interest rates outside of the Reserve Bank’s cash rate movements,” she said.
“So in spite of the Reserve Bank keeping the cash rate stable this month we have reduced our three-year fixed rates in our Flexible Option product range.”
Meanwhile, ANZ has decided not to change the variable interest rates for its retail home loans after its May review.
The bank’s standard variable home loan rate remains at 5.88 per cent.
