Home loan rates over 9pc
STANDARD variable home loan rates offered by major banks have gone above 9 per cent for the first time in more than a decade.
BankSA yesterday announced it was increasing the rate on its standard variable loan to 9.02 per cent.
National Australia Bank said it would raise its rates within days and that the increase was likely to be more than the 0.25 percentage point increase forced on banks by the Reserve Bank this week.
The move follows the Commonwealth Bank, which on Wednesday attracted the anger of customers by lifting rates by 0.3 percentage points.
Westpac also moved upward yesterday to bring its rates to 8.97 per cent, level with the Commonwealth.
The Reserve Bank has been trying to dampen inflation, lifting rates in November and this week.
But extra volatility has been injected into the market by the fallout of the sub-prime crisis in the U.S which has made lending money more expensive globally.
NAB chairman Michael Chaney said the bank was under pressure to raise rates further.
“We’ve only passed on half of the total cost increase that we’ve experienced in the past few months,” he said.
“It’s an issue of balancing competitiveness, customer interest and shareholder interest.” The last time rates at major banks topped 9 per cent was in mid-1996.
BankSA general manager Chris Ward urged customers to look at alternatives to the standard variable loan.
“It’s important to note, almost half of our home loan customers have fixed rate home loans and will not be affected by the change, while most of those with variable loans already pay more than their regular minimum repayment - this is something we encourage,” he said.
“However, we do recognise that any increase to rates does have an impact and if any customers do have any concerns about their mortgage, I certainly would urge them to contact us.”
The ANZ said it was reviewing its rates while HomeStart in SA said its standard variable rate would increase to 9.12 per cent.
