Westpac follows NAB to increase home loan interest rate

Westpac follows NAB to increase home loan interest rate

Yesterday (16th of March 2017) it was NAB who decided to increase and today (17th of March 2017) it’s Westpac’s turn to hike it’s rates.

The bad news

From the 24th of March 2017

  • Variable home loan rate for owner occupiers will increase by 0.03% to 5.32% per annum for customers will principal and interest repayments
  • Variable home loan rate for owner occupiers will increase by 0.08% to 5.49% per annum for customers with interest only repayments
  • Variable residential investment property loan rate increase by 0.23% to 5.79% per annum for customers with principal and interest repayments
  • Variable residential investment property loan rate will increase by 0.28% to 5.96% per annum for customers with interest only repayments

 

Unfortunately, there was no sign of a record low rate (3.69% fixed for 2 years) introduction, unlike NAB’s announcement from Thursday.

George Frazis, Chief Executive of Westpac Consumer Bank, said today’s decision takes into account a number of economic and regulatory factors.

“Today’s changes are in response to increasing funding costs. 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,” Mr Frazis said.

“We try to balance the needs of both owner occupiers and investors in making these decisions while continuing to provide customers with a competitive offering across our range of products.

 

How much have the big 4 increased their home loan rates since April 2016?

How much have the big 4 increased their home loan rates since April 2016

Current standard variable rates of the big 4 banks

ANZ, Westpac, ANZ, and CBA’s current standard variable rates

 

Considering that CBA had already repriced their home loans earlier this year, our analysis shows that ANZ will be next to reprice their home loan rate.

At LoanDolphin we have analysed thousands of rates and found that, on average, owner occupiers were able to refinance their mortgage at 3.85% and residential investment loans at 4.02%. That’s over $5,000 per year in savings.

 

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