Mortgage rates for self managed super funds could fall by as much as 15 basis points over the next few months as competition in the sector heats up.
Speaking to The Adviser, Mortgage EZY head of sales and marketing Chris Wisbey said competitive pressures would force lenders to cut their rates in a bid to remain strong within the sector.
In the last two months, two non-bank lenders have entered the SMSF market.
Six weeks ago Australian Financial entered the market with a loan that boasted a mortgage rate of 7.75 per cent, while in early July Mortgage EZY launched a product offering a variable rate of 7.89 per cent on a loan-to-value ratio of 70 per cent.
The lenders join St George, Westpac, NAB, CBA and The Rock Builiding Society in offering loans to SMSFs.
Mr Wisbey said the non-bank lender’s product was well priced and easy to understand and as such, was already generating a lot of interest.
He said Mortgage EZY expects SMSF loans to account for at least 10 per cent of its total settlements in the next 12 months.
“The majors are really focused on competing in the owner-occupied space, so we are seeing real opportunity to target a specialist area such as SMSF loans,” he said.
“People are really interested in using their SMSF to buy property and we can now actively target those borrowers.”
This information is provided by DPN Pty Ltd ABN: 94 630 700 186 Australian Credit Licence 514759. DPN Finance Pty Ltd is an authorised credit representative 504129 and related entity of DPN. Credit for Dream Big 100% Offset and Work Smart 100% Offset is provided by Adelaide Bank a division of Bendigo and Adelaide Bank Ltd, ABN 11 068 049 178 and Australian Credit Licence 237879. Casa Capace Operations Pty Ltd, NDIS provider number 4050038018 trading as Casa Capace.