Kin’s Money

Today the Daily Telegraph is reporting Wizard Home Loans to be the first lender to drop it’s variable home loan rate by 0.25%.

The Reserve Bank’s meeting this Tuesday is expected to cut rates, and now several lenders have promised to pass on any cut in official interest rates.

Mr Bouris, Chairman of Wizard Home Loans said:

“It’s a risk,… while [other banks] were very quick to hike their rates independently to the RBA when funding costs were increasing earlier this year, they are now just stalling - waiting until an announcement by the RBA.”

Which begs the question, will wizard also drop their rates by the same amount as any cut on Tuesday? Or will it claim this as its cut, running the risk of appearing hypocritical.

This news is good for homeowners, but not so much for savers. While several banks have passed on interest rate rises as higher rates on savings accounts, they seem to be quick to cut them alongside Reserve Bank cuts, while rising loan rates independent of official rises and not raising savings rates. And it seems that this trend is set to continue with at least one bank already cutting fixed interest savings accounts in the last week.

On a personal note, I’m looking forward to any rate cut, as that will help us pay our mortgage on our block of land off quicker. We also have an offset situation, and redraw, so all our surplus funds sit there saving us interest every day.

What are your thoughts? Do you have mortgages or savings? Are you looking forward to rate cuts?