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Westpac cuts fixed interest rates

(Source: Getty)
(Source: Getty)

Westpac mortgage-holders will be happy to see their rates slashed as the bank slashes rates on fixed-rate home loans by as much as 20 basis points (0.2 of one per cent).

Those with three- and five-year fixed option home loans paying principal and interest will have their rates slashed by 0.1 per cent, while four-year home loans will be reduced by 0.2 per cent.

Those paying off their fixed rate investment property loans with principal and interest will also see rates slashed by 0.2 per cent, while those with five-year investment loans will see a cut of 0.1 per cent.



Property investors with a two-year loan will see a modest 0.06 per cent reduction.

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The changes will be effective from Friday 12 April.

There’s a chart for all that:

Westpac fixed rate changes

<em>(Source: Westpac)</em>
(Source: Westpac)

The changes follow on just two days after the Commonwealth Bank of Australia cut its fixed-rate packaged home loans.

It also puts Westpac and CBA’s fixed rates on par with each other, Canstar finance expert Steve Mickenbecker pointed out.

“Westpac and Commonwealth Bank have now matched their 2-, 3- and 5-years fixed rates,” he said.

“These decreases are a further sign that the big banks are wanting to fight back to regain the market share losses to the local arms of foreign banks and other domestic lenders over the past 12-months.”

More cuts to come

With two of the four major banks slashing fixed rates in the space of a week, other banks will likely follow suit, said RateCity research director Sally Tindall.

Indeed, more than 40 lenders have already dropped their rates since the beginning of 2019.

“Right now, the banks have one eye on the possibility of a rate cut and the other on securing new customers,” Tindall said.

“Competitively priced fixed rates are a great marketing tool to secure new customers and keep them on their books for up to five years.

“But with a rate cut on the horizon, potentially in the second half of 2019, Australians are reluctant to lock in their rate.

“This week’s housing finance data shows just 16 per cent of new loans taken out are fixed,” she said.

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