Mortgage rate hikes continue, with UBank and Virgin Money raising some rates by 20 basis points

Posted: 14 January 2019 8:46 am

Dominoes falling against a house.

BankWest and BankVic have actually lowered some of their mortgage rates.

UBank today raised rates on some of its interest only investor loans by 20 basis points. It's joined by Virgin Money, which is raising rates on multiple Reward Me home loans.

Bank of Queensland made the news last week when it announced it was increasing selected interest rates in order to deal with rising funding costs. This was a common explanation for a string of rate rises last year.

And now it looks to be an early trend in 2019.

Who's raising rates?


UBank raised its 1, 3 and 5 year fixed investor interest only rates by 20 basis points today.

Virgin Money

Virgin Money raised rates for new lenders on multiple Reward Me home loans, between 5 and 20 basis points last Friday.

Bank of Queensland

This lender kicked off the latest round of rate moves last week, raising owner occupier and line of credit rates by 11 to 18 basis points last Friday.

Crunching the numbers

A 20 basis point rate rise can increase your mortgage repayments significantly. Here's an example calculation:

  • The average Australian home loan size (according to the latest ABS statistics): $386,300
  • Loan term: 30 years
  • Interest rate: 3.80%
  • Monthly repayment = $1,799

But if your rate went up by 20 basis points it would look like this:

  • Interest rate: 4.00%
  • Monthly repayment = $1,844

That's an extra $540 a year and enough to put serious strain on some borrowers.

But it's not all rate hikes. Bankwest and BankVic have actually lowered interest rates in the past week.



BankVic lowered a range of fixed rate products by 5 to 20 basis points.

With the Reserve Bank not meeting until February and funding costs continuing to weigh on lenders, we can expect a lot more rate movements up and down over the coming month. As always, borrowers need to keep an eye on their mortgage rate and switch to a lower one. The savings can quickly add up to thousands of dollars.

Worried about rate rises? Compare and switch to a lower rate

Rates last updated September 16th, 2019
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Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Maximum Insured LVR Amount Saved Short Description
$0 p.a.
Low variable rate mortgage for owner occupiers looking to switch. Refinancers only.
$0 p.a.
Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees.
$10 monthly ($120 p.a.)
A low fixed rate loan that lets you borrow up to 90% of your property's value.
$299 p.a.
Get a 100% offset account and a competitive, variable interest rate, plus no application fee.
$0 p.a.
This loan offers a competitive variable rate and a 100% offset account to help save you on interest repayments.
$10 monthly ($120 p.a.)
A very low variable interest rate for home buyers with a 30% deposit. This product has a 100% offset account.
$395 p.a.
A low variable rate loan with a 100% offset account and package discounts.
$395 p.a.
A package loan that offers discounts and a 100% offset account.
$0 p.a.
Get a low variable rate from a ANZ and save money with $0 application or ongoing fees. Requires a 20% deposit.
$248 p.a.
Borrowers with a 30% deposit can get this competitive rate. Cut down on interest costs with a 100% offset account.

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