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Banks continue to tweak interest rates to entice customers towards variable rate loans, with Commonwealth Bank hiking its fixed rate interest loans for the third time in six weeks and Westpac slashing rates on variable finance.<\/p>\n
Banks continue to tweak interest rates to entice customers towards variable rate loans, with Commonwealth Bank hiking its fixed rate interest loans for the third time in six weeks and Westpac slashing rates on variable finance.\u00a0<\/p>\n
CommBank\u2019s changes included hikes of owner-occupier fixed rates ranging between 0.15 per cent to 0.3 per cent, while investor fixed rates were increased by up to 0.6 per cent, depending on the length of the term.<\/p>\n
Those moves followed CommBank raising fixed rates on October 15 and November 5.<\/p>\n
RateCity.com.au research director Sally Tindall said CommBank\u2019s rate hikes were designed to offset funding pressures that have escalated in recent weeks.<\/p>\n
\u201cCustomers waiting in CBA\u2019s queue to have their loan approved who didn\u2019t lock in their rate will be cursing themselves this morning, particularly as CBA has one of the cheapest rate lock fees available,\u201d Ms Tindall said.<\/p>\n
\u201cIt\u2019s raining rate hikes and the storm is nowhere near over. The flood of fixed rate hikes is likely to keep going as the cost of fixed-term funding continues to rise.\u201d\u00a0<\/p>\n
RateCity research showed there were 161 fixed rate loans under 2 per cent six months ago, compared to just 87 available today.\u00a0<\/p>\n
\u201cNAB is the only big four bank with a rate starting with a \u20181\u2019 \u2013 its 1-year fixed rate \u2013 however this is likely to rise in the next round of the bank\u2019s rate hikes,\u201d Ms Tindall said.\u00a0<\/p>\n
\u201cWhile there are still a decent range of short-term fixed rates under 2 per cent, there are now just three 3-year fixed rates under this mark and no 4- or 5- year rates starting with a \u20181\u2019.\u00a0<\/p>\n
\u201cSurprisingly, Greater Bank is still offering the lowest fixed rate in our records at 1.59 per cent for up to two years, however, this record-low rate is unlikely to see the year out.\u201d\u00a0<\/p>\n
Westpac also hiked its fixed rates this week, while also cutting variable rates, joining 39 other lenders who have slashed variable rates in the past four weeks.\u00a0<\/p>\n
Canstar general manager of research and insights, Mitch Watson, said competition on variable interest rates was starting to ramp up.\u00a0<\/p>\n
\u201cThose who held off fixing before fixed rates started rising recently may be kicking themselves now but there’s still an opportunity to make the most of it by chasing lower variable rates and using the flexibility of a variable rate to get ahead on repayments,\u201d Mr Watson said.<\/p>\n
\u201cThe variable rate cut from Westpac follows similar variable rate movements from NAB, ANZ and 38 other lenders and points to further competition amongst lenders on variable rates.<\/p>\n
\u00a0\u201cVariable home loans have traditionally been Australians\u2019 preferred loans with increased flexibility to make repayments and access offset accounts.\u00a0<\/p>\n
\u201cThe lower an interest rate an Australian borrower can access now creates a buffer against future increases on interest rates.\u201d<\/p>\n<\/p><\/div>\n