Interest Rates

[PTILoveYou]

I showed my BNZ rate lock form, and Westpac matched it 4.49% 1 year refix =)

[mrfox]

Hi all, first time post but I want some opinions with my rates.

Currently $400k ($397k to be exact) fixed at 6.29% with Kiwibank, just under 2 of the 3 years to go. Kiwibank have said their break fee is ~$8,000.

BNZ have offered 4.49% to fix for 2 years, with a $4k incentive to come across. Kiwibank have offered 4.55% with $2.5k.

Assuming I add the break fee to the principle, I should come out $1k ahead in 12 months time and $9k in 24 - so it is certainly worth doing. The break even is all based on fixing 100%.

I guess my question is whether to go for it or wait a bit longer i.e. until the next OCR announcement in a couple of weeks. I know there are no crystal balls but I am mindful of the balancing act between the rate I pay and how the break fee may move against me if rates fall further...or will they remain in step?

[andyp2010]

Have you tried going back to kiwibank with bnzs offer?

[mrfox]

Have you tried going back to kiwibank with bnzs offer?

Not yet, was intending to do so tomorrow. Have no issues changing banks though, if it comes to it...not a fan of KB service, not that it really matters much these days.

[BigDreamer]

Anyone with Sovereign? My PPOR is with them and I'm curious what rates they are giving out lately.

[Courham]

I fixed $220k for 6 months at 5.1% with them about 8 weeks ago (just beofre the last fall, not the best rate but will do in the short term.

Craig

[MysteryCat]

Hi all, first time post but I want some opinions with my rates.

Currently $400k ($397k to be exact) fixed at 6.29% with Kiwibank, just under 2 of the 3 years to go. Kiwibank have said their break fee is ~$8,000.

BNZ have offered 4.49% to fix for 2 years, with a $4k incentive to come across. Kiwibank have offered 4.55% with $2.5k.

Assuming I add the break fee to the principle, I should come out $1k ahead in 12 months time and $9k in 24 - so it is certainly worth doing. The break even is all based on fixing 100%.

I guess my question is whether to go for it or wait a bit longer i.e. until the next OCR announcement in a couple of weeks. I know there are no crystal balls but I am mindful of the balancing act between the rate I pay and how the break fee may move against me if rates fall further...or will they remain in step?

How did you go about getting those offers? Did you approach each bank separately or through a broker? I'm in a similar position and wanting to know if they applied the 70% LVR rule (if you're based in Auckland.)

Has anyone else done this recently?

[Bluekiwi]

How did you go about getting those offers? Did you approach each bank separately or through a broker? I'm in a similar position and wanting to know if they applied the 70% LVR rule (if you're based in Auckland.)

Has anyone else done this recently?

Apparently all banks are currently applying the 70% rule except Westpac.
From 3 sources I have heard this.

[brokerman]

Apparently all banks are currently applying the 70% rule except Westpac.
From 3 sources I have heard this.

Correct, Westpac only Bank as long as settles by 30th Sept. Alternatives still out there to 90% for Investment property purchase, interest only at 6.4% fixed two years, includes low equity margin.

[Maccachic]

Hot off the email today:BNZ has today dropped the rate on its classic home loan. Fixed for a year will drop to 4.35% - this offer starts today and is available until September 20.
People need to have a minimum of 20% equity, their everyday banking and one other product with BNZ to take up this offer. Lending criteria, terms and fees apply.

[Future]

ASB and Kiwibank offers the same rate - 4.35% fixed for a year

Hot off the email today:BNZ has today dropped the rate on its classic home loan. Fixed for a year will drop to 4.35% - this offer starts today and is available until September 20.
People need to have a minimum of 20% equity, their everyday banking and one other product with BNZ to take up this offer. Lending criteria, terms and fees apply.

[PTILoveYou]

if all the main banks are all the sudden preparing to give such low rate, that means they are pricing at least 0.5% drop in OCR, plus they have big appetite for more business!

[Wayne]

if all the main banks are all the sudden preparing to give such low rate, that means they are pricing at least 0.5% drop in OCR, plus they have big appetite for more business!

we will see if you are right Gary.

[BigDreamer]

0.5% drop in OCR is pretty aggressive. It has happened after GFC but I wouldn't have expected it to happen now. Although, I really wish you are right Gary as I have a large number on floating at the moment waiting post 9-Sep.

[Viking]

Wait till after Xmas. The banks are stashing cash like no tomorrow.

http://www.interest.co.nz/business/77442/big-5-banks-increased-total-funding-163-bln-june-quarter-they-loaded-wholesale-money

and it's all on again for the next round.

http://www.interest.co.nz/news/77469/asb-matches-bnz-435-one-year-cuts-most-other-fixed-rates-sets-new-low-5-year-benchmark

4% after xmas.

Remember even when Scrooge Mc Whealer gets to 2% (As is being suggested by at least one bank), that's still higher than many other countries.

The world is awash with money looking for a home.
Trashing of oil price and commodity prices means that the traders and all have lots in their pockets they can't spend anymore.

Be Patient.

And remember banks make no money if they don't lend.

Also remember that right now and for sometime past they have been operating on a lot higher margin than 6-7 years ago.