Rams Home Loans Cuts its Variable Home Loan Mortgage rate

Post by NeilMc on November 8, 2008 · Under home loans, loans, mortgages, news · Comment 

Australian mortgage lender, Rams Home Loans (Rams) has followed suit, and cut the interest rate on its standard variable home loan by 60 basis points. The interest rate on Rams’ standard variable home loan now stands at 7.59 per cent, while the interest rate on Rams’ basic home loan is now 6.99 per cent.

The move to cut lending rates follows a 75 basis point cut to Australia’s official cash rate made by the Reserve Bank of Australia on Tuesday. The official cash rate now stands at 5.25 per cent

Commonwealth Bank of Australia (CBA) was the first to pass on the RBA’s rate cut last Tuesday, with Westpac Banking Corporation (Westpac), National Australia Bank (NAB) and St George Bank following suit since then.

None of Australia’s big four lenders have passed the full extent of the cut in official interest rates on to their customers citing higher funding costs. Australian banks have been required to obtain a lot of funding on wholesale international money markets, which completely froze at the start of October, following nationalisations of Fannie Mae and Freddie Mac, quasi nationalisation of AIG, and the bankruptcy of Lehman Brothers. Credit markets have still not returned to normal

Home lender Rams sold its brand-name and distribution business to Westpac earlier this year because it was unable to refinance its loans.

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