Auswide increases rates for investment loans

Auswide's managing director, Martin Barrett, said that from Tuesday, 11 July, the bank will increase rates 0.25 per cent, resulting in a new standard variable rate of 6.10 per cent.

Mr Barrett said that the moves come as the bank continues to experience funding pressures and regulatory limits on investment and interest-only lending, and follows a raft of changes announced by other lenders in recent weeks.

For example, ING DIRECT, Bendigo Bank and ME have all announced rate increases for interest-only loans in the past week.

He said: “We’d prefer not to be increasing rates, but have limited options in the current environment, which is the most challenging we have seen in sometime.”

However, Mr Barrett noted that many investment loan customers pay discounted rates less than the standard variable rate based on the size of their loan.

[Related: Bendigo follows competitors by hiking IO rates]