Non-bank lender BMC Mortgage the first to move independently of the RBA with variable rate cut

Sydney-based non-bank lender BMC Mortgage Corporation has become the first lender to cut its variable rates outside of an official RBA rate cut.

The lender dropped its variable home loan rates by 10 basis points yesterday, despite the RBA leaving the cash rate unchanged last week.

According to mortgage comparison website, it is the first lender to cut variable home loan rates out-of-cycle with the RBA

BMC Mortgage, based in Clarence Street in the Sydney CBD, offers homeowner and investment loans at 5.53% and a construction loan at 5.75%.

The rate cuts follows RAMS and Westpac both offering fixed-rate home loans below 5%.

Michelle Hutchison, spokesperson for RateCity, said the slow lending market is changing the way lenders compete for customers.

“We’ve never seen lenders cut variable rates while the Reserve Bank cash rate is on hold.

Lenders are obviously feeling the pressure of the slow mortgage market and are doing whatever it takes to attract new customers, including cutting their interest rates out-of-cycle.

The latest rate cuts follow poor lending market results in December, released yesterday by the Australian Bureau of statistics (ABS).

There were 43,885 home loans financed across Australia in December 2012, which was 10% down on December 2011 according to RateCity analysis (original figures).

NSW saw the biggest hit with 24% fewer home loans written in December 2012 (12,135) compared with December 2011 (16,054). Western Australia was the only state to see an increase, of 3% more in December 2012 (6536) than December 2011 (6318), according to RateCity.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer


Be the first one to comment on this article
What would you like to say about this project?