Heavy cuts signaled by ANZ for popular mortgage rates

The fast-moving interest rate landscape is changing who has the best offer (carded) rates.

Seeing the rates in our full tables is one thing, or even in the table at the foot of this article, but it doesn't give you an easy way to get a sense of the differences between bank offers.

But a dot-plot does.

At each fixed term, these show who has the lowest offer, and how your current bank compares.

It also helps you assess the rate benefits you give up for going shorter.

Today, Monday, the largest home loan lender, ANZ, cut its fixed rates (again), just the latest in a string of reductions, led by the major banks.

ANZ's biggest cuts were to their 12 and 18 month rates, taking them down -40 basis points (bps) and -50 bps to market-leading levels.

In fact going sub-6% for 18 months makes this their lowest since October 2022.

ANZ also cut their term deposit offers, taking -40 bps off their 12 and 18 month TD rates.

As we post this, ANZ has not released all the detail of this latest change - only that they will effective August 20, (along with the rates they want to skite about.) Update: They have now. And the Cooperative Bank has also cut its rates. In fact their one year rate at 6.39% is now the market low for that term.

With spring now just weeks away, and a central bank that has cut interest rates (and financial markets suggesting more are coming), banks will be very active and very competitive in pushing through multiple rate cuts to their advertised home loan rate cards.

First to break from the pack was ASB. Then it was Westpac. Responses from BNZ and Kiwibank will almost certainly come in the next day or two.

Main-bank competition is fierce at present.

Almost all banks will have some flexibility in their rate offers. So the carded rates are just the start. Negotiate. How flexible they may be will depend on the strength of your financials. And don't forget, banks have savvy tools at hand to 'know' the likely valuation of your property, so if the loan-to-value ratio (LVR) is near 80% you may not find them very accommodating for a lower rate. With falling house prices, the point where low equity premiums start applying is shifting around as well. See this.

And the carded rates we report here can be different to the rates banks might offer in their banking app. We would like readers to reveal what their banking app shows as the potential offer rates. Please add that market intelligence in the comment section below.

A quick check of the wholesale swap rate chart below gives a clear understanding of where funding costs are heading.

One useful way to make sense of the changed home loan rates is to use our full-function mortgage calculator which is below. Term deposit rates can be assessed using this calculator.

And if you already have a fixed term mortgage that is not up for renewal at this time, our break fee calculator may help you assess your options. Break fees will be minimal in a rising market. But they become important in a falling market.

Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at the moment.