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SERVICE ONE announces decreases to variable rate home loans

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SERVICE ONE today announced it will pass on the full 25 basis point decrease to variable rate home loans with principal and interest repayments. Borrowers on interest only repayments will benefit from a 0.20% decrease. These decreases will apply to both new and existing loans.

The decreases will become effective Wednesday 26 June 2019 (unless otherwise indicated) and the principal and interest loan changes are as follows:

Loan type Old rate (% p.a.) New rate (% p.a.) Change (% p.a.)
Standard Variable ($500k or more) OO 4.25 4.00 -0.25
Standard Variable ($250k - $499,999) OO 4.35 4.10 -0.25
Standard Variable ($50k - $249,999) OO 4.50 4.25 -0.25
Standard Variable (less than $50k) OO 5.00 4.75 -0.25
Visa card secured by an OO home loan (effective 1 July 2019) 5.00 4.75 -0.25
HomePlus OO 5.35 5.10 -0.25
Standard Variable ($500k or more) I 4.43 4.18 -0.25
Standard Variable ($250k - $499,999) I 4.53 4.28 -0.25
Standard Variable ($50k - $249,999) I 4.68 4.43 -0.25
Standard Variable (less than $50k) I 5.18 4.93 -0.25
Visa card secured by an I home loan (effective 1 July 2019) 5.18 4.93 -0.25
HomePlus I 6.15 5.90 -0.25

OO = Owner Occupied, I = Investment

Existing borrowers on non-standard or negotiated rates and loan products other than the above including more recent headline offers will have their rate reduced ranging from 0.10% to 0.25%. 

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

SERVICE ONE Chief Executive, Matthew Smith, reiterates the careful consideration that is given when making pricing decisions.

"We’re pleased to pass on the full rate cut to the vast majority of our home lending portfolio and hope these savings have a positive impact on both households and the broader economy. For instance, borrowers on an owner occupied Standard Variable loan of $400k over 25 years with principal and interest repayments will save $672 over the course of a year. 

"Because we don’t reduce the loan repayments unless requested by a borrower, this will also be a good opportunity for our borrowers who can afford to maintain their current repayments to get ahead on their loans. 

"These pricing decisions are not taken lightly - particularly in today’s market, with a challenging funding environment and a slowing home lending market - these pose challenges for SERVICE ONE as an organisation but passing on the rate cut in full is the right thing to do by our Members," Mr Smith explains.

Any SERVICE ONE borrower experiencing financial hardship or wanting to discuss their home lending arrangements in more detail should phone 1300 361 761 or visit their local Branch.

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