ANZ lifting interest-only, investor rates
ANZ has announced it will lift rates on investors and interest-only borrowers.
We previously reported that ANZ’s IT systems would not allow the lender to differentiate pricing between interest-only and principal and interest borrowers. The bank is apparently working to rectify the situation, as today it announced it would raise rates for both new and existing interest-only borrowers, albeit with a long lead time.
ANZ said it would lift rates across all investor variable rate loans by 25 basis points from 31 March. This will take the bank’s variable rates for investors from 5.60% to 5.85%. From 22 April, though, new interest-only investor loans will be hit by a further 11 basis point increase, taking the rate to 5.96%.
Owner occupier borrowers who choose interest-only payments will also see a rate increase of 20 basis points, from 5.25% to 5.45%. The change will be effective from 22 April for new borrowers.
Existing borrowers will have longer to adjust to rate changes, however. The bank said the changes for interest -only loans wouldn’t hit existing customers until late July.
“ANZ will be writing to existing interest-only variable home loan customers from May to provide them with advance notice of the change and the option of switching to repay principal and interest on their loan at a lower interest rate without incurring a fee,” the bank said in a release.