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ANZ cuts new customer variable rates as existing borrowers face 8th hike in 8 months
ANZ has today cut the rates on its basic home loan for new customers, as existing variable borrowers face their eighth hike in as many months.
Australia’s fourth largest lender has dropped the rate on its Simplicity Plus home loan by up to 0.10 percentage points for owner-occupiers and up to 0.20 percentage points for investors.
However, these discounts are reserved for new customers with big deposits.
Today's changes from ANZ for owner-occupiers paying principal and interest
| ANZ Simplicity Plus | Old rate | New rate | Change |
| Loan-to-value (LVR) 70% or less | 4.69% | 4.59% | -0.10% |
| LVR 80% or less | 4.79% | 4.69% | -0.10% |
| LVR over 80% | 5.73% | 5.73% | No change |
Source: RateCity.com.au.
ANZ is not discounting new customer variable rates in isolation. Since the RBA hikes began in May, analysis from RateCity.com.au shows 38 lenders have cut at least one variable rate for new customers, including all four big banks.
During this time, the majority of existing variable rate customers have seen their rates rise by 2.75 percentage points.
Big four banks – how much more are existing customers paying after just one year of loyalty?
If someone took out one of the big four banks’ lowest variable rates in November 2021 – just 12 months ago – they would now be on a rate that is, on average, 0.42 percentage points higher than what is on offer to new customers, almost two standard RBA hikes more.
On a $500,000, 25-year loan today this difference could equate to an estimated $2,097 extra in interest over the next year.
Existing customer vs new customer variable rates
Assumes borrower took out the bank’s lowest rate loan in Nov 2021 and has not negotiated since
| Estimated existing customer rate | New customer rate | Difference % points | |
| CBA | 5.04% | 4.57% | +0.47% |
| Westpac | 4.94% | 4.49% for 2 yrs then 4.89% | +0.45% for 2 yrs |
| NAB | 5.04% | 4.74% | +0.30% |
| ANZ | 5.04% | 4.59% | +0.45% |
Source: RateCity.com.au. Rates are for owner-occupiers paying principal and interest on the big four banks’ lowest variable rates. New customer rate includes Westpac’s introductory rate and CBA’s package loan rate.
RateCity.com.au research director, Sally Tindall, said: “ANZ has cut its lowest variable rate in order to stay in the refinancing game.”
“While the bank’s lowest variable rate is still above its rivals, CBA and Westpac, with a $4,000 refinancing cashback it’s likely to tempt some new borrowers in the door,” she said.
“ANZ borrowers might see these new customer discounts as a betrayal of their loyalty, but they’re actually a gift, because they can use these new advertised rates to negotiate a cut for themselves.
“Refinancing is at near record highs, at the same time thousands of fixed-rate loans are poised to roll back into the market. It’s no wonder the banks are taking the knife to their sharpest variable rates in a bid to attract these potential new customers.
“Since May, most variable borrowers have seen their rates rise by 2.75 percentage points, yet 38 lenders have cut variable rates for new customers.
“Test out your bank’s loyalty by seeing what rate it’s offering new customers for the exact same loan. If you haven’t negotiated your rate in a while, you’re likely to find there’s ample evidence on their website to haggle for a cut,” she said.
The 5-minute loyalty test:
- Look up what rate you’re paying and check how much of your loan you’ve paid down.
- Check what your bank is offering new customers for the exact same loan.
- See what other lenders might be willing to offer factoring in how much of your home you own.
- Pick up the phone and haggle.
Big four bank lowest variable rates
| Lender | Advertised rate |
| CBA | 4.57% |
| Westpac | 4.49% for 2 yrs then 4.89% |
| NAB | 4.74% |
| ANZ | 4.59% |
Source RateCity.com.au. Rates are for owner-occupiers paying principal and interest. LVR restrictions apply. CBA’s lowest rate is a package loan with a $395 annual fee.
Lowest variable rates on RateCity.com.au
From lenders that have announced November RBA hikes
| Lender | Advertised rate | LVR required |
| Bank First | 4.19% | 60% or less |
| Auswide Bank | 4.21% | 75% or less |
| Hume Bank | 4.24% | 60% or less |
| Bank Australia | 4.24% | 90% or less |
Source RateCity.com.au. Rates are for owner-occupiers paying principal and interest. LVR restrictions may apply.
Disclaimer
This article is over two years old, last updated on November 30, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent home loans articles.
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