Firstmac sets new floor for variable rates in the broker market

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A non-bank lender has “set a new floor” for variable interest rates in the brokerage market as the group seeks to take on banks which have increased their market share in recent months.

Firstmac cut new business rates by 10 basis points on its Broker Special product line and ZIP home loan, effective immediately, now offering the lowest advertised variable investor rate available to brokers as well as the one of the lowest variable rates for homeowners.

Managing Director Kim Cannon has expressed hope that the rate cuts will help the group prevent history from repeating itself.

“During GFC, the big banks increased their dominance in the market due to their funding advantage, but we’ll make sure this time around is different,” he said.

“We have successfully raised $ 2.3 billion in financing since the onset of the COVID-19 crisis and we compete aggressively for blue chip loans as a real alternative to banks.”

Now the owner-occupant of the Broker Special basic 80 P&I group is only 2.59%, its investor rate for the same category is 2.84% and the ZIP loan is 2.73%. Plus, there are no annual or ongoing fees associated with group loans.

The strength of the lender has been clearly demonstrated through the pandemic, as the most recent analysis of its $ 12.6 billion loan portfolio showed that the proportion of its borrowers with hardship arrangements COVID-19 not only gradually declined, but remained “consistently lower” than banks.

According to Cannon, its superiority in this regard can be attributed to the group’s personalized approach to tailoring a solution to each borrower’s individual circumstances.

“The number of borrowers in need of hardship arrangements has declined steadily since mid-June and was about 10% below its peak at the end of July,” Cannon said.

“The transparency and solidity of our portfolio of prime loans has been a key factor in maintaining our financial support, which has enabled us to continue to offer brokers competitive products with rates among the best in the market,” like our special offers for brokers. ”


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