CommBank cuts interest rates on additional home loans
CommBank has offered some relief to Australians struggling with the cost of living crisis by dramatically reducing its interest rates on additional home loans for new borrowers.
The increased life of the loan discount, effective Friday, September 2, means homeowners will save 0.1%, while investors could face cuts of up to 0.8% .
The lowest variable rate is now 3.69%, down from 3.79%. Investors with a loan-to-value ratio between 80.01 and 90% can also expect their rates to fall from 5.29% to 4.49%.
CommBank said the changes are part of its ongoing review of interest rates and market conditions.
“We continually review our interest rates to ensure they remain competitive and meet customer needs,” he said in a statement.
This is the second time CommBank has cut variable rates for new customers since the RBA hikes began.
The bank also cut its additional home lending rates by 0.15 percentage points at the end of June.
Although the announcement is good news for new borrowers, the discount does not extend to existing customers.
Rate City’s research director Sally Tindall said this should prompt existing CommBank borrowers to have a difficult conversation with the bank.
“CBA has cut its lowest variable rate to 3.69%, but not a single existing customer will get that discount unless they do something about it,” she said.
“You may have had a Dollarmites account since you were knee-high to a grasshopper, but at what cost? Nostalgia only goes one way.
“The ABC is not alone in offering discounts to new businesses. A total of 24 lenders have now cut some variable rates for new customers since the RBA started to hike in May.
“Don’t bother getting mad at your bank, getting quits, by getting into tough negotiations or switching to a lender who values your business more.”