ANZ National make major changes

Tuesday, October 13th 2009, 8:00AM

ANZ and National Bank have both made major changes to their home loan interest rates, dropping floating rates and raising all rates of terms of one year or more.

The biggest change is National dropping its floating rate 70 points to 5.75%, while ANZ left its standard variable rate unchanged. However it has introduced what it calls a Simple Variable rate for mortgages with a loan-to-valuation ratio of less than 80%. This new rate is set at 5.69% versus the unchanged standard rate of 6.45%.

NBNZ now matches ASB and Bank Direct on floating rate terms and is 4 points lower than Kiwibank. The only bank with a lower rate is BNZ which has pitched its Total Money rate at 5.59%.

ANZ and NBNZ have also reduced their revolving credit interest rates, but hiked fixed term rates of more than one year.

NBNZ's increases range from 30 to 50 basis points with the biggest changes being made to two year and 18 month rates respectively. ANZ's changes are smaller being in the band of 30-45 points.

The bad news for borrowers is that the biggest changes are to the shorter term rates.

Westpac has also made significant changes to its shorter term rates with its one-year rate going up by 10 basis points, its 18-month term has increased 20 basis points and its two-year has been increased by 24 points to 6.79%. Even with these latest increases, Westpac are still offering the lowest one and two-year rate by a major bank. On another good note, Westpac's capped rate was cut 20 basis points to 6.29% this morning.

Other rate changes to note today is SBS Bank's 15 and 20 point increases to its two and three-year fixed rates to 6.75% and 7.75% respectively. These rates are now above the median for non-bank lenders.

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