By now, you may have heard that many of Australia’s lenders have raised their home loan interest rates.
Over the last couple of weeks, almost all of Australia’s lenders have increased their standard variable rates, affecting both owner occupiers and investors.
Some lenders have raised their rates by as much as 39 basis points, while others have only increased their rates by 3 basis points.
These rate increases occurred outside of any movements by the Reserve Bank of Australia, with the Board again opting to leave the official cash rate on hold.
While it is interesting to see many of Australia’s lenders lift their rates outside of the Reserve Bank, it is not altogether unusual.
Sometimes, different domestic and global economic factors ultimately force Australia’s lenders to adjust their home loan rates.
In this instance, the banks are telling us that increased funding pressures have forced them to lift their rates.
In December and March, the United States’ Federal Reserve lifted the official cash rate. These rate adjustments have put additional pressure on bond yields and, in turn, offshore funding costs.
As a result, Australia’s lenders have been forced to absorb these higher funding costs and pass them onto their borrowers by way of higher home loan rates.
So what does this recent spate of rate increases mean for you?
Depending on your loan and your lender, the rate increases could result in higher ongoing mortgage repayments.
Please contact us so that we can help you review your mortgage and make sure you are still in the right home loan solution for your needs. We may find that there is a better and sharper priced product on the market that better suits your financial situation.
If you are looking for some interest rate certainty, you may want to consider fixing part or all of your home loan.
Whatever you want to do, we can help.
Don’t let the threat of rising home loan rates keep you up at night. We can walk you through all your home loan options and ultimately find you a product that meets all of your needs and goals.