Heartland offering lowest floating loan rate

AUCKLAND: Heartland has cut its floating home loan rate to a record low 2.5% — undercutting other banks’ floating and some fixedterm interest rates.

Floating rates are typically much higher than fixedterm rates as banks like the certainty of having borrowers locked in for a certain time.

The big four Australianowned banks — ANZ, Westpac, ASB and BNZ — have floating rates ranging from 4.44% to 4.59%.

The closest is Kiwibank which dropped its floating rate earlier this year to 3.4% and was the lowest in the market until Heartland dropped its rate.

Heartland Bank has made a major play for homeloan borrowers, relaunching into the market last month with a recordbreaking 1.99% for a oneyear fixed term, the first time a New Zealand mortgage has gone under 2%.

Heartland Group chief executive Jeff Greenslade said customers should not have to pay so much for their floating home loan.

The rate isavailable only for homeowners refinancing or buying a standalone house on a single section. They must have a deposit or equity of at least 20% and live or intend to live in the home.

The bank is also offering a cashback of $750 for those who refinance their home loan and take the floating rate for at least 12 months. If the customer moves to a fixed rate or leaves the bank before the end of that term they will have to pay that money back. —