Mortgage movement sees lenders continue to hike fixed rates, slash variable rates

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on November 19, 2021 Fact Checked
Mortgage movement sees lenders continue to hike fixed rates, slash variable rates

Over the past week, fixed interest rates have spiked by up to 57 basis points on some home loans while variable rates were cut by up to 26 basis points.

An ongoing trend has emerged as many lenders continue hiking fixed interest rates while cutting variable interest rates on mortgages.

For example, Great Southern Bank hiked fixed rates by up to 57 basis points while simultaneously cutting its variable rates by up to 20 basis points.

To give you a clear snapshot of the fixed and variable interest rate movement over the past week, these have been separated.

Fixed interest rate movement

Great Southern Bank increased a number of its owner occupier and investor fixed interest rates by up to 57 basis points:

  • Fixed P&I 2 years: 40 basis point increase to 2.34% p.a. (3.55% comparison rate)
  • Fixed P&I 3 years: 57 basis point increase to 2.59% p.a. (3.51% comparison rate)
  • Investment Fixed Interest Only (IO) 2 years: 50 basis point increase to 2.79% p.a. (3.98% comparison rate)
  • Investment Fixed IO 3 years: 54 basis point increase to 2.99% p.a. (3.92% comparison rate)

86 400 also raised its fixed interest rates by up to 55 basis points, including:

  • Own Home Loan Fixed IO 5 yrs: 55 basis point hike to 3.59% p.a. (3.03% comparison rate)
  • Own Home Loan Fixed P&I 3 yrs 80-85%: 50 basis point hike to 2.99% p.a. (3.08% comparison rate)
  • Own Home Loan Fixed P&I 5 yrs 80-85%: 50 basis point hike to 3.49% p.a. (3.32% comparison rate)

UBank increased fixed interest rates by 40 basis points on a number of its mortgages:

  • UHomeLoan Fixed IO 5 yrs: 40 basis point increase to 3.14% p.a. (2.58% comparison rate)
  • UHomeLoan Fixed IO 5 yrs 80-85%: 40 basis point increase to 3.34% p.a. (2.76% comparison rate)
  • UHomeLoan Fixed P&I 5 yrs: 40 basis point increase to 2.99% p.a. (2.53% comparison rate)

Variable interest rate movement

Great Southern Bank decreased its variable interest rates by up to 20 basis points:

  • Basic Variable P&I ≤80%: 20 basis point drop to 2.19% p.a. (2.24% comparison rate)
  • Offset Variable P&I ≤80%: 15 basis point drop to 2.39% p.a. (2.44% comparison rate)

IMB also decreased its variable rates by up to 26 basis points:

  • Essentials Home Loan P&I ≤70%: 26 basis point decrease to 2.43% p.a. (2.57% comparison rate)
  • Investment Essentials Home Loan P&I ≤80%: 20 basis point decrease to 2.78% p.a. (2.97% comparison rate)

Other notable mortgage activity

A number of lenders also increased their fixed home loan interest rates, including Westpac and its subsidiaries BankSA, Bank of Melbourne and St George all hiking by up to 40 basis points.

Auswide also increased some home loan rates by 20 basis points.

While most lenders have hiked their fixed rates, there were a few select lenders that actually dropped their fixed interest rates this week.

For example, Summerland Credit Union decreased its fixed interest rates by up to 20 basis points.

Additionally, Gateway Bank increased and decreased its fixed interest rates by up to 34 basis points and 20 basis points respectively.


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Lender

Variable
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Variable
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Variable
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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 22, 2022. View disclaimer.


Image by Joan Oger on Unsplash

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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Rachel is a Finance Journalist, and joined Savings in 2021. Coming from a background in the FinTech space, her interests include the innovation of lending technology, property, investing, and more. With a passion for educating and informing people about their finances, she hopes to increase the financial literacy of everyday Australians.

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