St George Bank will cut their standard variable home loan rate by 85 basis points. Their rate comes down to 6.89 per cent. The announcement comes 24 hours after the Reserve Bank of Australia (RBA) decided to cut official cash rates by 100 basis points.
Yesterday, Bankwest cut home loan rates by 85 basis points while The Commonwealth Bank and National Australia Bank passed on the full 1 per cent rate cut. Westpac Bank, which owns St George, has cut their rates by 80 basis points.
"Due
to the ongoing impacts of the global financial crisis, financial
institutions continue to face higher costs in both the short and long
term wholesale funding markets," St George general manager of retail
bank distribution Andrew Moore said.
"These much higher funding costs overall mean that we are unable to pass on the full RBA decrease of one per cent."
A cut of 0.85 per cent on a $250,000 mortgage saves home owners around $145 per month on their mortgage repayments.
The RBA has cut rates a total of 300 basis points in the past four months, in an attempt to stop Australia from falling into a recession. In September, when rates were at 7.25% and home loan rates were almost 10% the local economy slowed rapidly. Home-owners will be grateful for this pre-Christmas gift, while potential home owners wanting to take advantage of low rates are now eyeing up the market.
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