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Variable rate Home Loan changes

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SERVICE ONE announced a 10-basis point increase to the majority of the SERVICE ONE Alliance Bank range of variable rate home loan products for Principal and Interest repayments only. This change impacts both owner occupied and investor rate variable loans. This change does not impact Interest Only loans, the Partial Offset rate or HomePlus equity loans. 

The following changes will take effect Thursday 26 July 2018 (unless otherwise indicated) and will be applied to existing loan products from this date:

Owner occupied

Loan type Old rate (% p.a.) New rate (% p.a.) Change
Standard Variable (index rate) 5.10 5.20 +0.10
- for loans under $50k 5.10 5.20 +0.10
- for loans between $50k and $249,999 4.60 4.70 +0.10
- for loans between $250k and $499,999 4.45 4.55 +0.10
- for loans over $500k 4.35 4.45 +0.10
Base Variable 4.70 4.80 +0.10
Pioneer Banking Package ($200k - $499,999) 4.50 4.60 +0.10
Pioneer Banking Package ($500k or more) 4.35 4.45 +0.10
Visa card secured by an owner occupied home loan (effective 1 August 2018) 5.35 5.60 +0.10

Investor

Loan type Old rate (% p.a.) New rate (% p.a.) Change
Standard Variable (index rate) 5.30 5.40 +0.10
- for loans under $50k 5.30 5.40 +0.10
- for loans between $50k and $249,999 4.80 4.90 +0.10
- for loans between $250k and $499,999 4.65 4.75 +0.10
- for loans over $500k 4.55 4.65 +0.10
Base Variable 5.20 5.30 +0.10
Pioneer Banking Package ($200k - $499,999) 5.00 5.10 +0.10
Pioneer Banking Package ($500k or more) 4.85 4.95 +0.10
Visa card secured by an investment home loan (effective 1 August 2018) 5.30 5.40 +0.10

Members with loans affected by these changes will receive correspondence confirming the change and how it impacts them.

General Manager - Banking, Tony Brown, provided some insight into the decision.

“as the market has been indicating, there has been consistent upward pressure on funding costs over the recent past and as a result Bendigo and Adelaide Bank has moved their variable rate loan rates. These changes have resulted in a subsequent review by SERVICE ONE Mutual Limited, and as a result, it has been decided to move variable rate SERVICE ONE Alliance Bank loans by 10 basis points,” Mr Brown said.

The variable loan rate increase equates to approximately an additional $20 in monthly loan repayments for a loan of $350k over 25 years.

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