Too scared to look: Huge gaps emerge as some lenders climb as high as 9 per cent
Another 20 lenders have today increased their variable rate home loans following the Reserve Bank decision earlier this month.
In total, 52 lenders have announced they are increasing variable rates on home loans and 20 became effective from today.Ā Some mortgage rates have lifted above 9 per cent with the lowest around 5.75 per cent.
Comparison website Mozo said the higher rates were often just āindicator ratesā which were used by lenders to base other loans off.
Mozo said the impact on borrowers also varied significantly between the states, based on the average home loan size.
In Queensland, the average home loan was about $537,000 which meant the average monthly repayment was $3757, an extra $1200 since the first rate hike in May 2022. In NSW borrowers need an extra $1690 and Victoria $1326.
Spokeswoman Rachel Wastell said the 13 rate hikes and the most aggressive rate hiking cycle since the early 1990s had put significant pressure on mortgage holders and the Mozo analysis showed most mortgage holders had most likely had to find an extra thousand dollars or more every month to service their loan.ā
āThatās nothing to sneeze at in the lead up to Christmas,ā she said.
āThere is a real risk that borrowers are exhausted, and that the thought of checking interest rates after the latest rate hike could be too much to bear.
āHowever, itās more important for homeowners to check rates now than ever, especially as weāre seeing rates on the Mozo database starting with a 9.ā
āThe thing with home loan rates is that the smallest difference in interest rates can equate to a big difference in repayments. As little as half a percentage point difference in interest rates can add up to tens of thousands of dollars more in interest over a 20 or 30 year loan term.
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āFor homeowners paying rates starting with 6, 7 or 8, now could be the time to switch to a cheaper rate, as we still have a number of lenders on the Mozo database offering rates lower than 5.75%.
āAnd if you canāt switch due to serviceability, call your lender and ask if you can get a better rate.ā
āRemember, if you donāt ask, you donāt get.ā
Victorians, Queenslanders and ACT mortgage holders needed upwards of $1200 extra a month, while the NT is the only state that is looking for less than $1,000 more a month ā but only just, at $977.
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