Bankwest raises rates for existing interest-only owner occupiers

Bankwest raises rates for existing interest-only owner occupiers
Bankwest raises rates for existing interest-only owner occupiers

Bankwest, the Commonwealth Bank of Australia subsidiary, has raised rates for existing interest-only owner occupiers.

The increase of 35 basis points is the latest move to rein in higher-risk loans.

The lender is decreasing lending on selected principal and interest products by up to 15 basis points to encourage property buyers to switch to, packages requiring principal repayment.

Transfer fees will be waived for existing borrowers with the bank switching to principal and interest loans.

"Bankwest is mindful of its broader obligations as a responsible lender and aims to balance the needs of customers, shareholders and regulators when reviewing products and pricing," a spokesman for the bank to The Australian Financial Review.

"These changes are being made in line with regulatory guidance."

From Tuesday, principal and interest investor and owner occupier loans will be reduced by 15 basis points and 12 basis points respectively.

From October, existing investor and owner occupier interest-only loans will be increased by 25 basis points and 35 basis points respectively.

It also created a new category of low-deposit loans for those with less than 5 per cent deposit by raising rates to 5.29 per cent, up from 4.53 per cent.

The new rate is inclusive of expensive lenders' mortgage insurance. The comparative rate, which takes into account all fees and charges, will rise from 4.94 per cent to 5.69 per cent.

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Interest Rates Bankwest

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