Yellow Brick Road (YBR) has increased the rates for one of its home loan products due to higher funding costs.
The interest rate for the mortgage and wealth group’s Rate Smasher Home Loan has been raised from 3.91 per cent to 4.07 per cent, while the comparison rate has increased from 3.92 per cent to 4.07 per cent.
A YBR spokesperson told The Adviser that the rates increase has been passed on due to a rise in funding costs, but the group endeavours not to change rates out of cycle.
“Costs of funds impact everyone in the market,” the spokesperson said. “When the banks went up in October/November, we held our rate[s] steady until now.”
YBR executive chairman Mark Bouris described the group’s new 4.07 per cent comparison rate as “one of the sharpest rates available today” and “a direct challenge to the big four banks”.
“We’re in the fortunate position of being a nimble, young company that can react quickly to market opportunities. Last year we capitalised on the low-rate environment that saw a rush of borrowers entering the market,” he said.
Mr Bouris said YBR’s leveraging of its Channel Nine relationship via Celebrity Apprentice Australia has helped deliver “record settlements, a pipeline full of applications and a new high in the company’s home loan market share”.
“So, we sharpened the campaign and renewed the push,” he said.
“In a flat market, the game is to refinance the books of other entities and we’re finding that much of the business we’re sourcing is coming from the big four.
“[Banks] may be big, but they’re not invincible. In this environment, as Kerry Packer once famously said, ‘No one is safe’.”
The new comparison rate for YBR’s Rate Smasher product was announced yesterday as part of its re-vamped home loan challenge campaign – the the first in a series of three advertisements being rolled out over three months, which will also focus on financial advice and superannuation.