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NAB’s latest mortgage rate rise is a timely reminder to check your rate and find a better deal

Posted: 24 January 2019 2:22 pm
News

Woman at her desk looking stressed.

NAB is raising its Tailored Home Loan variable rates, but those rates are already high. Every other lender (including NAB itself) has much better offers.

It's always news when one of the Big Four raises interest rates, and NAB has done just that. The bank will increase investor and owner-occupier rates on its variable Tailored Home Loans on 31 January 2019.

Increased funding costs are to blame, once again, with NAB's Chief Customer Officer - Consumer Banking Mike Baird (who has some experience with unpopular decisions) saying in a statement that the bank "held off as long as we could despite being subject to the same increasing wholesale funding costs and market pressures as other major lenders."

Increases in mortgage rates are news for a reason. A rate rise of 16 basis points on a $400,000 mortgage over 30 years would add hundreds of dollars a year in repayments.

But this doesn't have to hurt NAB customers, current or future. NAB is only touching one product. The bank's lowest fixed rate offer for first home buyers is currently a very healthy 3.69%.

NAB even specified in its statement that this rate won't be affected by the changes on 31 January.

Here are the affected NAB rates

NAB's lowest variable rate is 3.87%. That's certainly not the lowest rate you can see on Finder, but it's far lower than the Tailored Owner-Occupier Principal and Interest rate of 5.24% (which will rise to 5.36%).

There are better deals everywhere, even with the Big Four. And while rates are usually higher for investor and interest-only loans, there are far more competitive rates on offer in these categories too.

The lesson is simple: check your interest rate. If it's too high, demand better. Find the lowest rate your lender offers and ask to switch to it. Just make sure it's a comparable product (if you're an investor, you can't ask to switch to your lender's lowest owner-occupier rate).

If your bank doesn't cooperate, then ask for a mortgage discharge form. Then start comparing rates and refinance to a new and better loan.

Check out some of Finder's lowest rates right now

Data indicated here is updated regularly
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Loan purpose
Offset account
Loan type
Repayment type
Your filter criteria do not match any product
Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
UBank UHomeLoan Variable Rate - Discount Offer for Owner Occupiers, Variable P&I Rate
2.49%
2.49%
$0
$0 p.a.
80%
Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees.
St.George Basic Home Loan - LVR 60% to 80% (Owner Occupier, P&I)
2.64%
2.66%
$500 (waived for loans above $150,000)
$0 p.a.
80%
Refinancers borrowing $250,000 or more can get up to $3,000 cashback (Other terms, conditions and exclusions apply). A low variable interest rate for home buyers and refinancers. Application fee waived for loans above $150,000.
Athena Variable Home Loan - Owner Occupier, P&I
2.59%
2.55%
$0
$0 p.a.
80%
Owner-occupiers with 20% deposits can get this competitive variable rate mortgage. $0 application fee and $0 ongoing fees.
Suncorp Back to Basics Home Loan - Better Together Special Offer $150k+ LVR<=90% Incl. LMI (Owner Occupier, P&I)
2.78%
2.79%
$0
$0 p.a.
90%
Get one free online redraw per month and pay no ongoing fees. Application fees are waived for loans above $150,000. Refinance to an eligible Suncorp loan and get a cashback of $2,000 or $3,000, depending on your loan amount. Other conditions apply.
HSBC Home Value Loan - Promotional Offer (Owner Occupier P&I)
2.65%
2.66%
$0
$0 p.a.
80%
Get a low interest rate loan with no ongoing fees. Plus you can make extra repayments and free redraw online.
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