BankWest, a subsidiary of Commonwealth Bank of Australia, will today announce a 76 basis point interest rate rise for principal and interest home buyers, the latest twist in lenders’ attempts to slow borrowing and lower risk of bad debt on loan books as market sentiment sours.
The bank is creating a new category of low deposit lenders 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.
Presumably this hits existing higher risk loans.
One wonders how much of this is tightening on the ongoing Perth bust. All the good clients have probably been shifted to the mother ship already.
