What the NAB Fixed Rate Hike for Home Loans Means in 2022

0

Last week, the NAB sent the biggest signal yet that the RBA may well deliver on its pledge to keep the cash rate low, by raising its fixed rates to three, four and five years.

The rate hikes show renewed confidence the Big Four banks have in the RBA, especially given their fairly public deviations from central bank policy in recent months.

The CBA had publicly floated the idea that rates would increase in 2022 and increased their variable rates accordingly, a move that reverberated through the industry.

This was before the recent extended shutdowns in New South Wales and Victoria, which appear to have reset thinking and brought it back into line with RBA expectations.

The Big Four banks are still largely hanging on to their floating rates below 2% at 2 years, but with the majority of the market now turning to refinancing and locking in low rates, it was inevitable that the fixed rate would rise.

“With vaccination rates rising and foreclosure restrictions easing, the RBA is staying the course and believes the economy will rebound, albeit with a delayed timeline,” said Jay Ahluwalia, senior mortgage broker at TrueSavings.

“Lenders and the RBA seem to agree that the cost of financing will have to rise as 2024 approaches. As fixed-term interest rates rise, there is a need for education on its implications for the client. “

“Fixed terms can provide certainty of payment when convenient for the customer, but what could have been the right loan a year ago could now cost you more than the market. “

“As the savings equation evolves with rising interest rates, we are reaching out to clients to review their home loans to ensure the loan they have is still meeting their needs and goals. . “

“As trusted experts, education, scrutiny and constant attention to service is what will generate real savings for the Australian borrower.”

Read more: What brokers really think about cashback offers


Source link

Share.

Comments are closed.