Mortgage

Athena slices variable mortgage rates for new and existing customers

Athena slices variable mortgage rates for new and existing customers
Written by Publishing Team

Athena splits variable mortgage rates for new and existing clients

While some mortgage lenders have welcomed the New Year with higher interest rates, Athens has gone the other way.

Athena has announced that it is reducing variable rates for all new and existing customers, which is noteworthy because many lenders’ rate cuts only apply to new loans – existing customers usually have to demand a better deal.

Principal Owner and Interest (P&I) in Athens with less than 60% LVR is now at 1.89% p.a., while P&I Investor at less than 60% LVR is now at 2.19% p.a.

The comparison rates are the same as the advertised rates.

This rate cut marks the ninth time Athens has lowered its variable rate in three years.

During the month to mid-December last year, 52 lenders raised their two-year fixed-rate products, and 64 lenders raised their three-year fixed-rate products.

Within 12 months, the major banks raised their four-year fixed rates by between 126 and 135 basis points.

Nathan Walsh, CEO and co-founder of Athena, said there is a lot of speculation that the liquidity rate will rise later this year.

“We have the opportunity to allow our clients to save more and move forward with their loan before that happens,” said Mr. Walsh.

“That’s what our voluntary rate drop is all about.”

According to Athens, these interest rate cuts could save the “typical” homeowner $54,318 over the life of the loan, or $181 per month based on the average advertised rate of 2.70% on a $450,000 mortgage.

Reserve Bank of Australia data shows that the average advertised rate for landlord occupants is 2.30% per annum

Athens’ interest rate cuts across its mortgage loan portfolio include:

  • Celebrate Owner P&I <60% LVR: Decrease by 10 basis points to 1.89% annually (1.89% comparison rate*)
  • Owner-occupied evaporation P&I 60-70% LVR: 15 basis points down to 1.94% YoY (1.91% comparison rate*)
  • Owner Editing P&I 70-80% LVR: 20 basis points down to 1.99% annually (1.93% comparison rate*)
  • Celebrate an investor’s P&I with less than 60% LVR: 20 basis points down to 2.19% per annum (2.19% comparison rate*)
  • Investor P&I evaporation 60-70% LVR: 25 basis points down to 2.24% per annum (comparison rate 2.21%*)
  • Investor Editing P&I 70-80% LVR: 30 basis points down to 2.29% per annum (comparison rate 2.23%*)

These product names refer to Athens’ “waterfall” rates, where customers automatically get a more competitive interest rate when they pay their mortgage.

Time to make the switch?

Athena notes that mortgage refinancing to other lenders increased by 28% in 2021 versus 2020.

Michael Starkey, chief operating officer and co-founder of Athens, said he expects this trend to continue.

“A lot of clients will put up their one or two year fixed rates that they got during the first close and they will be shocked by much higher variable rates, some of which can be over 3%,” Starkey said.

“It’s a great opportunity to turn into a provider who stands by them – and gives them prices starting at 1.”


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the lender

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Image by Abby Savage via Unsplash.

The entire market was not taken into account when choosing the above products. Instead, a reductive segment of the market was considered. Some providers’ products may not be available in all states. To be considered, the product and price must be clearly posted on the product provider’s website. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au and Performance Drive are part of the Savings Media Group. For full disclosure, Savings Media Group is associated with Firstmac Group. To read about how the Savings Media Group manages potential conflicts of interest, along with how to get paid, please visit the website links at the bottom of this page.

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