Should NAB’s latest fixed home loan rate rise spark borrowers to action?

By Tom Watson · · 3 min read
Fact Checked
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National Australia Bank (NAB) has increased the interest rates across a number of its fixed home loan terms this morning by between 5 and 10 basis points.

The increases apply to 2, 3 and 4-year fixed rate terms on the NAB Tailored Home Loan and Tailored Home Loan (Choice Package) products for owner occupiers. 1 and 5-year rates were left unchanged though.

As a result, the updated fixed rates available for new customers will be as follow:

Tailored Home LoanTailored Home Loan (Package)
2-year2.09% (4.22% comparison rate*)1.99% (3.98% comparison rate*)
3-year2.18% (4.05% comparison rate*)2.08% (3.86% comparison rate*)
4-year2.34% (3.93% comparison rate*)2.24% (3.77% comparison rate*)

NAB is not the only member of the big four to have recently lifted rates though. Back in May, the Commonwealth Bank added 5bp to its 3 and 4-year fixed rates.

And earlier this month, ANZ increased its 4-year fixed rates by 25bp and its 5-year fixed rates by 45bp, while Westpac pushed both its 2 and 3-year fixed home loan rates for owner occupiers up by 10bp.

Is now the time to lock in?

Taking a broader look at the fixed rate landscape, a large number of lenders have lifted their longer (4 and 5-year terms) fixed rates in the past few months.

As the graph below shows, this trend is reflected in the 4 and 5-year fixed rate averages in the Mozo database for owner occupiers, both of which have noticeably increased since reaching low points in March.

However, shorter term fixed rates (1, 2 and 3-years) have continued to edge down. In fact, the June averages for those terms are at their lowest points since tracking began in 2015.

So the big question for borrowers, especially those thinking about locking in a rate on their home loan, is how long these relatively low fixed rates are likely to stay for?

ANZ, the Commonwealth Bank and NAB have all recently forecasted that the Reserve Bank will start to increase the official cash rate later in 2022 - earlier than they had previously indicated.

That’s well ahead of the RBA’s own outlook that interest rates won’t start to rise until 2024, but as Mozo’s banking expert Peter Marshall says, banks and other lenders will start to make their moves based on their own forecasts.

“I think that if the lenders think the cash rate is going to go up they will be putting up their rates, regardless of what the Reserve Bank says about the timing of future rate increases.”

When it comes to locking in a rate, Marshall believes that the present moment could be a good opportunity.

“If borrowers take into account the restrictions (including early repayment fees and additional repayment limits) and they can get an interest rate that they are comfortable with, it's a good time to look at long term fixed rates.”

RELATED: Meet the lenders taking on the big banks in 2021

Curious about how the rates on offer from NAB and the other big four stack up against other lenders?

Get started by checking out some of the great offers in the table below, or head on over to our fixed rate comparison hub to compare even more home loan deals.

^^Average fixed home loan rates for owner occupiers are based on loans tracked in the Mozo database and the following borrower scenario: a $400,000 loan with an 80% loan-to-value ratio and principal and interest repayments.

Home loan comparisons on Mozo

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can compare more home loans here.
Last updated 27 July 2024 Important disclosures and comparison rate warning*

  • Optimum Fixed Rate Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.69 % p.a.
    Fixed 3 years
    Comparison rate
    6.34 % p.a.
    Initial monthly repayment
    $2,899
    Go to site

    Lock in a competitive interest rate and enjoy peace of mind for the fixed period. Available for owner occupied new and refinanced home loans with at least 20% deposit. Split option available as well as offset and redraw. Noapplication, ongoing or banking fees. Third Party fees may be applicable - payable within loan repayments. Extra repayments up to $20K per annum permitted. Apply online, 100% member owned credit union.

  • Flex Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    5.99 % p.a.
    Fixed 3 years
    Comparison rate
    6.34 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Competitive Fixed rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.

  • Basic Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR<70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.20 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $10,000,000.

  • Offset Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR <70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.42 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.54 % p.a.
    Fixed 2 years
    Comparison rate
    7.10 % p.a.
    Initial monthly repayment
    $3,174

    Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.

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Need help with refinancing?

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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

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