Westpac cuts new loan rates, and promises longer discounts

Westpac has cut its rates, and promised longer discounts.

The nation's second-largest lender has cut lending rates by up to 110 basis points in an aggressive bid for new borrowers.

Its new loan packages also aim to lock-in new borrowers with lucrative discounts of up to 80 basis points for the life of the loan. A basis point is 0.01 percentage point.

Fairfax Media advised the new Westpac rates will also apply for new lenders for Bank of Melbourne, BankSA and St George Bank.

The offer will replace the existing two-year introductory discounts with a life of loan discount for principal and interest and interest only borrowers.
The new flexi first option home loan, with its basic home loan product with a headline rate of 3.98 per cent, will now include a 75 basis point discount for the life of the loan.

The flexi first principal and interest option for investors, which has a headline rate of 4.48 per cent, includes an 80 basis point discount for the life of the loan.

The interest only version has a headline rate of 5.08 per cent and a 71 basis point life of loan discount.

The offer excludes owner occupied loans with interest only repayments or to switches within the Westpac Group.

Westpac is set to advise the new first time buyer flexi first option home loan borrowers will receive an 85 basis point discount for the first five years and then roll onto a 75 basis point discount for the life of the loan. The headline rate is 3.88 per cent.
First time investors will receive a 110 basis point discount for the first five years and then revert to a 80 per cent discount for the loan's life.

Its headline rate is 4.18 per cent.