CommBank hikes fixed mortgage rates twice in three weeks

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on April 12, 2022 Fact Checked
CommBank hikes fixed mortgage rates twice in three weeks

The Commonwealth Bank increased fixed home loan rates across a wide range of products by up to 90 basis points.

The home loan in question to get hiked by 90 basis points - nearly one full percentage point - was the two-year fixed investment loan paying interest-only (IO).

It is now 4.59% p.a. (5.17% p.a. comparison rate*).

CBA sent interest rates north on a whole range of fixed home loans on Tuesday, with some key ones including:

  • Residential Fixed 2 Years P&I: Increased by 50 basis points to 3.94% p.a. (4.58% p.a. comparison rate*)
  • Residential Fixed 5 Years P&I: Increased by 20 basis points to 4.64% p.a. (4.73% p.a. comparison rate*)
  • Investment Fixed 2 Years P&I: Increased by 50 basis points to 4.14% p.a. (5.09% p.a. comparison rate*)
  • Investment Fixed 5 Years P&I: Increased by 40 basis points to 4.94% p.a. (5.19% p.a. comparison rate*)

This marks the second time in three weeks CBA raised interest rates, and the fourth for 2022.

In January, the residential two-year fixed advertised rate was 110 basis points lower at 2.84% p.a. (4.39% p.a. comparison rate*).

On the ABS-defined average home loan of $596,000, 110 basis points extra adds $363 per month in interest costs on a 30-year mortgage.

In contrast, CBA's rate-locking feature costs $500 and applies for 90 days.

Other major banks to hike recently include:

Westpac has cut five times so far this year, one or two more than the other majors.

See Also: Mortgage rates at pre-pandemic levels, average home loan size soars

CBA subsidiary also hikes

Last Tuesday CommBank's subsidiary Bankwest hiked fixed rates by up to 90 basis points.

Some key increases included:

  • Owner Occupier 1 Year 80%: 70 basis point increase to 3.29% p.a. (4.66% p.a. comparison rate*)
  • Owner Occupier 5 Years 80%: 80 basis point increase to 4.89% p.a. (4.89% p.a. comparison rate*)
  • Investor 1 Year P&I: 10 basis point increase to 3.49% p.a. (5.27% p.a. comparison rate*)
  • Investor 5 Years P&I: 90 basis point increase to 5.09% p.a. (5.35% p.a. comparison rate*)

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Lender

Variable
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Variable Home Loan (Principal and Interest)

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Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of May 26, 2022. View disclaimer.


Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.

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Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison strives to deliver and edit news and guides that are engaging, thought-provoking, and simple to read.

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