Heritage passes on full interest rate decrease

Australia’s largest building society, Heritage, has announced that it will pass on the full 0.25 per cent interest rate decrease to its variable mortgage interest rates following yesterday’s official announcement by the Reserve Bank of Australia (RBA) to decrease the official cash rate.

Heritage CEO Mr John Minz said that Heritage now offered its members a significantly better deal than its competitors, including the major banks.

“As a mutual building society our focus is on delivering a better deal to our members. This can only be achieved through strong long-term management of our balance sheet, diversified funding sources and our mutual business model. This allows us to provide our members with better value and the tangible benefits of passing on the full RBA interest rate decrease,” Mr Minz said.

“Heritage is a strong and robust mutual organisation and our ability to pass on this latest interest rate reduction is a testament to our financial strength and stability.

“I believe this is a reflection of our prudent business model that has been the foundation of the Society’s continuing strong success.

“In spite of the economic conditions the Society continues to show the benefits of sustaining our high quality loan book which is demonstrated by the Society’s low mortgage arrears rate[1] of 0.35% that was recorded at 31 December, 2008.”

Mr Minz added, “In the current environment, I am sure that the additional reductions in mortgage repayments will be a welcome relief to many household budgets.”

“At Heritage, we understand the pressures that the current economic climate has had on our members. We anticipate the announcement of further rate reductions will not only assist families with their mortgage repayments but also give first home buyers encouragement to enter the property market.”

“At Heritage, our focus is on putting People first, and to demonstrate this, the Society is still offering competitive interest rates across its range of savings and term deposit accounts. Any reduction on the interest rates applying to these products will be delayed to ensure that our members continue to get a better deal,” Mr Minz said.

“Heritage will continue to provide safety and security for its members. As Australia’s largest building society we offer our members a better deal by providing lower fees and charges, higher deposit rates, lower lending rates and better service as compared to the major banks.

“Heritage continues to stay away from high risk loans such as low-doc and no-doc loans. With one of the lowest mortgage arrears rates in the industry, the Society is continues to show the benefits of sustaining our high quality loan book,” Mr Minz said.

[1] Percentage of mortgage loans in arrears greater than 30 days.

* Based on a $150,000 loan over 25 years. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.