ING Direct latest in flood of bank rate hikes: see them all here
ING Direct is the latest in a long line of lenders to follow the big four banks in hiking rates across owner-occupier and investment mortgages, putting the squeeze on homeowners and property hopefuls across the country.
Australia’s major banks have been hiking home loan rates this month, despite the RBA keeping the official cash rate on hold at 1.50% at its March meeting. And now as the month draws to a close, Mozo data has shown that a flood of smaller lenders are following suit.
ING Direct was the most recent to announce changes, hiking the standard variable rate on investment loans by 0.25%. As of 4 April 2017, that puts the Orange Advantage home loan at a rate of 5.42% for investors, while the Mortgage Simplifier will stand at 5.32%.
Aside from the changes made by the big four banks, we’ve noted mortgage rate increases from 24 other lenders over March, across loans for owner-occupiers and investors.
(Update 4/4/17: There are now 31 providers that have increased rates.)
Overall, borrowers making interest only repayments were hit with the biggest increases, at an average of 0.12% for owner-occupiers and 0.23% for investors. Rate increases on principal and interest loans were milder, at an average 0.09% for owner-occupiers and 0.20% for investors.
The team at Mozo have been keeping their finger on the pulse of interest rate hikes, so if you’re wondering what changes your lender has made, take a look below.
(Keep in mind, these changes are for new lending. Customers with existing loans should be notified by their provider if their rate changes.)
- Adelaide Bank - Rates on both principal and interest and interest only loans were increased by 0.25%, and LVRs for investors were also restricted to 80% (previously 95%.) Effective 7 April 2017.
- AMP - Mortgage rates for owner occupier loans with principal and interest repayments will go up by 0.07%, as of 31 March 2017.
- Aussie - Effective 31 March, 2017, investment loan rates increased by 0.25%, while interest-only loans for owner-occupiers increased by 0.05%.
- Update 4/4/17: Auswide Bank - Investor loan rates increased by 0.13%, effective 5 April 2017.
- Bank of Melbourne - Changes made across the board: owner occupiers can expect hikes of 0.03% on principal and interest loans, and 0.11% on interest only. Investors will be hit with 0.31% and 0.39% increases on principal and interest and interest only loans respectively. Effective 8 May 2017.
- BankSA - Interest only loans will increase by 0.08% for owner-occupiers and 0.32% for investors. Investors looking to make principal and interest repayments can also expect hikes of 0.24%. Effective 8 May 2017.
- Bankwest - Changes for investors have been in effect since 15 March, with rates rising by 0.15% for principal and interest and interest only loans.
- Update 4/4/17: BCU - Owner-occupier loan rates increased by 0.10%, while investor rates increased by 0.15%, effective 4 April 2017.
- Bendigo Bank - Investment loan rates will be hit by 0.25% increases from 31 March 2017.
- Citibank - Rates increased by 0.09% across the board. These changes became effective from 28 March 2017.
- CUA - Owner occupier loans for both types of repayments increased by 0.15%, starting today, 30 March 2017, while investment loans are no longer available to borrowers at all.
- Gateway Credit Union - Rates on new investor loans increased by 0.10% on 1 March, 2017.
- Heritage Bank - From the 14 March 2017, rates on the owner occupier Home Advantage Package loan increased by 0.10%
- HSBC - Rates on investment loans with both principal and interest and interest only repayments increased by 0.25% on 27 March 2017.
- Illawarra Credit Union - Owner occupier loans with principal and interest repayments saw rates increase by 0.05%-0.15% on 1 March 2017, while those making interest only repayments saw increases of 0.10%.
- iMortgage - Since yesterday, 29 March, Elite loans for investors rose by 0.25%. Elite loans for owner occupiers making interest only repayments also increased by 0.05%.
- Update 4/4/17: IMB Bank - Owner-occupier rates increased by 0.10% and investor rates went up by 0.25%, effective 5 April 2017.
- ING Direct - Investor rates to increase by 0.25%, effective 4 April 2017.
- Liberty - As of 24 March, rates on investor loans increased by 0.10%.
- Macquarie - Investor loans for under $750,000 saw an increase of 0.25%, while those looking to borrow more were hit by a 0.30% hike. Effective 23 March 2017.
- ME - Investment loan rates will increase by 0.25% for new and existing borrowers, effective 27 April 2017.
- MyState - Investment loan rates are set to increase by 0.28%, effective date not yet announced.
- Northern Inland Credit Union - Rates on the Dream Value Package for investors increased by 0.20% on 24 March 2017.
- Police Credit Union - Investor interest rates increased by 0.15% on 7 March 2017.
- RAMS - Investment loans are set to increase by 0.18% for principal and interest loans, and 0.28% for interest-only loans. Effective 27 April 2017.
- Resi - Investment loan rates will increase by 0.25%, effective 7 April 2017.
- St.George - Investor loans with principal and interest repayments will see a rate hike of 0.23%, while rates for those making interest only repayments will increase by 0.31%. Owner-occupiers who opt for interest-only repayments will see their rate increase by 0.08%. Effective 8 May 2017.
- Teachers Mutual Bank - Effective 1 March, rates rose across the board - for owner-occupiers and investors of all repayment types - by 0.15%.
- UniBank - Owner-occupier and investor rates rose by 0.15% across the board, as of 1 March 2017.
- Victoria Teachers Mutual Bank - Increases of 0.10% for both owner-occupiers and investors came into effect on 6 March 2017.
- Yellow Brick Road - Rates on the Empower Loan for investors increased by 0.25%, while investors opting for the Empower Package loan saw an increase of 0.32%. Effective 23 March 2017.
Want to see what the big banks have been up to? Check out the rate hikes from the Big Four here.
In light of the interest rate hikes, borrowers eager to avoid higher repayments should start looking at options to score a better deal, including refinancing their home loan and considering locking into a fixed mortgage. To start your search for a better value offer, check out our home loan comparison tool.