Two of the Big Four have increased home loan rates
NAB and Westpac have both announced increases to variable home loan rates despite no move from the RBA.
Following the RBA’s decision to once again hold the cash rate for March 2017, most experts predicted that lenders would still make changes to home loan rates. Some lenders were quick to get their changes in after the RBA’s announcement, while others followed later.
However, the Big Four banks have remained mostly quiet in terms of rate changes, with the Commonwealth Bank announcing changes to loan-to-value ratios for investors but no changes to interest rates.
Yesterday, NAB announced changes to its variable rate products as well as a new special rate aimed at helping first home buyers fix their home loan rate for two years.
“The decisions we make on interest rates are difficult ones and we want to assure our customers that we do not take them lightly as we seek to achieve the right balance for all our stakeholders while considering the dynamic financial and economic environment in which we operate,” NAB chief operating officer Anthony Cahill said about the changes.
The new special rate for first home buyers is a 0.29% saving off the standard 2-year fixed rate. NAB has also increased its standard variable rate by 0.07% for owner occupiers and 0.25% for investors. These rates will become effective on 24 March.
Westpac has followed suit by announcing today that it would be increasing its variable rate home loan rates on 24 March by between 0.03% and 0.08% for owner occupiers and between 0.23% and 0.28% for investors.
“Today’s changes are in response to increasing funding costs," Chief executive of Westpac consumer bank George Franzis said today. "Despite home loan interest rates being at historically low levels, both deposits and wholesale funding of mortgages have increased over the last nine months. We understand the significance of interest rate changes to our home loan customers, so we take a very careful approach to these decisions.”
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