Investors win as major bank undercuts competitors with loan changes
NAB has undercut some of its competitors with changes to its mortgage serviceability terms, making it easier for buyers to secure finance from this month onwards.
NAB is the last of the big four banks to lower its interest rate floor in response to APRA loosening its guidelines for loan serviceability.
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The big four bank has lowered its interest rate floor to 5.5 per cent and increased its interest rate buffer to 2.5 per cent. This will be effective for all new home loan applications from 5 August.
This means NAB has matched ANZ’s rate floor of 5.5 per cent. NAB has undercut CBA and Westpac, which both dropped their interest floor rates to 5.75 per cent.
“NAB welcomes the updated APRA guidelines on home lending serviceability. We believe now is the right time to change the approach to how the affordability rate floor is determined, given the continuing low interest rate environment,” said NAB’s chief customer officer of consumer banking, Mike Baird.
