Westpac has announced it will reduce its standard variable home loan interest rate by 0.25% for new and existing customers, effective 4 March, after the Reserve Bank of Australia (RBA) cut the cash rate to 4.10%.
"Today's decision will be welcome news for mortgage customers," Westpac consumer executive Jason Yetton said.
What does this mean for borrowers?
"By reducing the standard variable home loan rate by 0.25% p.a., customers will save an extra $90 per month, or $1,080 per year, based on a $500,000 home loan with principal and interest repayments," he continued.
It comes just one day after the big four bank announced it's introducing the option for eligible home loan borrowers to open multiple offset accounts at no additional cost.
It also follows recent cuts to Westpac fixed rates.
The bank shaved as much as 40 basis points from its fixed offerings last week, dropping rates to as low as 5.59% p.a.
Mr Yetton noted that borrowers might use the savings realised from today's rate cut to bolster their repayments or grow their offset accounts, helping to reduce interest costs over the longer-term.
The bank also noted that borrowers might choose to split monthly repayments into fortnightly repayments, which can lead to an extra month's worth of repayments each year.
Struggling home loan holders urged to seek support
Mr Yetton acknowledged many Australian borrowers are likely still feeling the pressure of higher living costs and encouraged customers to reach out for support if needed.
"We would encourage customers who need assistance to contact us," he said.
"We also have a range of tools available in our app to help manage finances, including a budget planner, bills calendar, and savings finder."
Borrowers seeking assistance can contact Westpac Assist on 1800 067 497, visit a branch, or call the bank's customer support team on 132 032.
Want to see how much this rate cut could save you? Use our Mortgage Repayment Calculator to find out.
Image by Nick-D on Wikimedia Commons
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