Bruce Patten: Loan Market Mortgage Advisor on the call for banks to slash home loan rates in the wake of the OCR cut

A mortgage advisor is joining the Finance Minister in urging banks to slash home loan rates.  

Nicola Willis is asking them to pass on “as much as possible” in the wake of the Reserve Bank cutting the Official Cash Rate to 2.25%. 

She says the banks have a stake in the economy, and passing the cuts on will make a significant difference.  

Loan Market Mortgage Advisor Bruce Patten told Mike Hosking the banks are holding onto some really good margins at the moment. 

He says he’d like to see them pass them on before Christmas – everyone needs it, so someone needs to make the move.  

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Episode Transcript

Speaker 1 (00:00):
So the jaw boning Post Reserve Bank CASHWEP mover has begun.
The Finance Ministy yesterday heaping pressure on the retail banks
to pass on those cuts in full. Well are they
Bruce Patton's Loan Market Mortgage Advisor and as with us, Bruce,
morning to you, good morning. Have they No?

Speaker 2 (00:14):
No, not at all. They're like a bunch of possums
in the headlights at the moment. They're waiting for someone
to make the first move. They didn't all pass on
the full floating discount, and they're holding some really good
margins at the moment. We can see that we're given
they're paying one and a half percent cash if you
move to them. So I'd like to suc see them
pass them on befull Christmas. Everybody needs it, you know,

(00:36):
so they somebody needs to make them move.

Speaker 1 (00:38):
So if you're in the camp at the Nikola Willis
camp that we these guys are not good actors and
they're not playing their part. This is evidence to suggest
Nicola might be on to something. Is that fair?

Speaker 2 (00:48):
Oh? Absolutely? Break coft for a client fixed for three
years at four nine nine, it's twenty grand at the
moment and you're now only getting four point seven nine
for three year. That tells me that they could be
done three years of at least four and a half.
So you know, there's definitely movement. Somebody needs to make it.
I'd like to see them make it in the longer
term because if we are at the bottom of the cycle,

(01:08):
people are going to want to fix for two or
three years. So there's no reason why we shouldn't have
those rates at least.

Speaker 1 (01:15):
Okay, So what's your vibe if you're in the fours,
If you're in the mid faurs and you're locking that
up for five years, that's about as good as it gets.

Speaker 2 (01:22):
Oh yeah, look, if you could get five years at
four and a half, I'd be happy with that. It's
self funding. If it's an investment, you know, the rents
covering the mortgage, everybody wins at that level.

Speaker 1 (01:31):
What's your vibe on this whole break free break fee?
You know, we'll give you cash. Let's change banks? Do
people change banks in big numbers? Is it easy or
too hard?

Speaker 2 (01:44):
It depends on the client and how long they've got left.
The reality is it works for the minority of people
at this point in time, but as a whole give
us lower interest rates longer term, and everybody does better.

Speaker 1 (01:57):
Good stuff, Bruce, good insight. Appreciate your time very much
and you good weekend. Bruce Patton, who's the loan market
mortgage advisor, is really disappointed. The woman whose name it
eludes me for now, on the Monetary Policy committee that
fronted up to the press conference a couple of days ago.
She alluded to it as in the margins, that the
banks are running the retail banks, but she alluded to
it in a I don't want to get involved. I'm

(02:18):
a bit namby pamby Hiadden. Forbid, I should say something
controversial kind of way, and I don't like people like that.
If you've got a point to make, the bloody point,
and if the banks are ripping us off, say they're
ripping us off, we need to do something about it.
So I'm more than happy to apologize to Nikola Willis
because I've argued that I can't really make up my
mind on who's the bad actor here, whether Nicholas is
overegging this or whether the banks actually actually aren't playing

(02:39):
the board. But you know, you can't argue with the margins.
Look at the margins, the margins and the margins, and
the banks keep defending it, but they're big margins. For
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