MortgageWatch: Smaller lenders move rates

The past week has been relatively quiet with only a handful of smaller lenders making changes to their mortgage rates.

Thursday, July 2nd 2009, 6:56AM

by Jenny Ruth

This reflects two things. As economists pointed out in our round up of views earlier this week there had been little movement in wholesale rates changes. Secondly there is a pecking order in how organisations move their rates.

Banks tend to lead the market and make changes more quickly than other lenders and the smaller organisations are slower to make pricing changes.

The current interest rate trends are reflected in this week's changes. Lenders are being fiercely competitive in six-month fixed rate term, while edging up their longer-term rates.

Public Trust cut its six-month fixed rate by five basis points to 5.50%, putting it in line with the bulk of the market but still above the lowest in the market, Westpac's at 5.39%.

The biggest increases were made by Wairarapa Building Society which raised its one-year fixed rate by 41 basis points to 6%, its two-year rate by 50 basis points to 6.75% and its three-year rate by 16 basis points to 7.15%, among the highest rates in the market.

Check and compare rates here

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