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Mutual bank drops interest rates

by Annie Kane4 minute read

Teachers Mutual Bank has announced that it will drop its variable interest rates by up to 25 basis points for new and existing borrowers from 1 August.

The banking group – including Firefighters Mutual Bank, Health Professionals Bank, Teachers Mutual Bank and Uni Bank – has said that it will decrease a number of its owner-occupier and investor variable interest rate product from 1 August following the Reserve Bank's decision to cut the official cash rate by 25 basis points.

On 2 July, the Reserve Bank of Australia (RBA) lowered the official cash rate to a new record low of 1 per cent, marking the second month in a row in which the cash rate had moved following nearly three years of inertia.

The adjustment provoked an immediate response from some players in the mortgage market, but announcements are still rolling out from the non-major and non-bank segment.

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The latest announcement comes from Teachers Mutual Bank Ltd.

Applicable for new business and existing borrowers (including those that have applied for a qualifying product and have been approved but not yet funded) the following rate reductions will apply for these specific products from 1 August:

Owner-occupiers

  • Classic Home Loan - principal and interest (P&I): 25 basis point drop
  • Solutions Plus Home Loan - P&I : 20 basis point drop
  • Solutions Plus Home Loan - interest only (IO): 20 basis point drop
  • My First Home Loan - P&I: 20 basis point drop
  • My First Home Loan - IO: 20 basis point drop
  • Interest Only Variable: 20 basis point drop
  • Flexi Choice Loan - P&I: 16 basis point drop

Investors

  • Classic Home Loan - P&I: 17 basis point drop
  • Flexi Choice Loan - P&I: 16 basis point drop
  • Interest only Variable: 16 basis point drop.

All other home loan interest rates remain unchanged, the banking group said.

[Related: Lenders continue to cut rates]

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Annie Kane

Annie Kane

AUTHOR

Annie Kane is the editor of The Adviser and Mortgage Business.

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