BoQ raises rates for home loan

BOQ is whacking higher rates on interest-only home loans, which the lender says is a response to tougher regulations imposed in recent months.

The move echoes responses by rival Big Banks. But it also comes with BoQ’s loan book already growing slower than anticipated, according to Morgan Stanley analysts.

BoQ’s move slugs an extra 40 basis points on interestonly home loans and mortgage-linked lines of credit.

The flip side is rates are falling 10 basis points for principal and interest home loans on a heavily promoted product.

It comes after the Australian Prudential Regulation Authority in March deemed interest-only loans should account for less than 30 per cent of new home lending.

BoQ said the move “reflects ever-changing market conditions in light of recent regulatory changes”.