Smaller lenders feeling rate cut pinch

Smaller lenders appear to be under pressure thanks to the record-low cash rate, with a significant proportion failing to lower their interest rates by a full 25 basis points following last month’s RBA decision.

Of the 78 mortgage lenders in the Infochoice.com.au database that opted to cut their standard variable rates in August, eight (10%) did so by less than the full RBA amount.

All eight consisted of non-major lenders whose rates are already ‘well below’ those of the big four.

Macquarie Credit Union and Bankstown Credit Union both cut their rates by 20 basis points and are still cheaper than the big four, with ANZ and NAB offering standard variable rates of 5.88%, CBA offering 5.9% and Westpac 5.98%.