By Brad Makivoy | May 11, 2017
Following the decision last month by many banks to lift home loan rates, disgruntled Aussie homeowners are heaping pressure on their banks by aggressively seeking better deals in the market.
Resentment has only risen amongst mortgage holders with the shock announcement that all the big banks, and many of their smaller competitors, would raise interest rates in direct defiance of the Reserve Bank’s decision to hold steady.
ANZ raised investor home loans by 25 basis points in March and are looking to increase their interest-only by 2 basis points by July. Even new customers can look forward to an additional 11 basis points from April.
CBA will follow suit, pushing the standard variable rate on interest-only investor loans by a whopping 26 basis points and owner-occupied loans by 25 basis points as well, whilst principal and interest loans increase by 3 points.
ANZ and CBA’s decision followed the trend set by NAB and Westpac earlier in the month.
While the banks have claimed that the rate rises are because of increased wholesale lending costs, financial experts aren’t buying it.
Omkar Joshi, a banking analyst with Regal Funds Management, explains. “The reality is it’s been really hard to raise rates, especially out of cycle with the RBA”.
Funding costs may just be a convenient excuse to boost the banks’ bottom line.
In response, homeowners are using the most powerful weapon they have, their wallets, by aggressively seeking better deals on the market.
The response has been particularly strong from property investors who have seen the interest rate gap between owner-occupied and investment loans widen to as much as 0.7%
Home loan comparison sites like Savings Hacker, have noticed spikes in traffic of as much as 20% since the announcement was made.
Getting the best deal on your home loan?
Use your bargaining power to seek a lower rate and make sure you’re getting the best deal, especially if you’ve been on the same home loan product for over 12 months.
One of the most expensive mistakes borrowers can make is sticking with their lender for too long. Refinancing is really quite simple and the payoff can be massive.
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