With last man standing NAB succumbing to funding pressures and announcing a home loan rate rise for new customers, Aussie mortgage holders are wondering one thing: can I save by switching home loans?
Since June, we’ve seen variable home loan rate rises across the board, affecting not only big four customers, but those with second-tier lenders, too.
Westpac, ANZ and Commbank customers, were hit with variable rate hikes of between 14 and 16 basis points.
“The reason cited for these hikes, according to the banks, is an increase in funding cost pressures, which then have a ripple effect on interest rates,” said Mozo Data Manager Peter Marshall.
Last week, NAB joined the troup, hiking its Base Variable Rate Home Loan rate by 18 basis points, but only for new customers.
“Whilst a rate hike is never good news for consumers, NAB’s actions shouldn’t be compared to the rest of the big four, who applied rate hikes across all of their variable home loan products.”
And it’s not just the big four that have made rate hikes, 14 second-tier lenders have increased their variable rates since Westpac made their announcement.
“Whilst it’s looking unlikely there will be any further rate rises in the near future, especially after another month of the RBA keeping the official cash rate steady, you should be evaluating the damage already done - specifically how it affects your mortgage repayments,” said Marshall.
“There’s no reason you should be paying more for your mortgage, so if you’ve been affected by
the recent rate rises, now could be a great time to make the switch.”
How much can I save by refinancing
If you’ve seen your home loan rate go up in the last few months and need to know what that means for your wallet, we’ve got you covered. We’ve taken our home loan repayments calculator for a spin to help you understand these changes, and see how much you can save by switching home loans.
If you were borrowing $400,000 and paying principal and interest over 30 years on the current average loan rate in Mozo’s database of 4.37%, your monthly repayments would have come to $1,994.
But, if your lender hiked your rate by 15 basis points, you’d pay an extra $37 a month or $444 a year.
However, if you were to refinance your home loan for the lowest rate in our database, Reduce Home Loans Rate Lovers Variable rate of 3.44%, you’d only pay $1,783, saving you $2,976 that year.
If your home loan rate just went up and you’re thinking of refinancing, check out some of the great offers below, or head over to our home loan comparison tool to find a deal that works for you.