Mutual banks lift variable mortgage rates

Only a couple of mutual banks joined this week's rate adjustments as others retreated to wait for RBA's cash rate decision on Tuesday.

The latest jobs figures falling in line with the Reserve Bank's forecasts have bolstered the call that this year's fourth policy meeting will deliver another rate hold.

While that's better than another series of hikes - in the minds of the mortgage belt - as some economists expect, the prolonged period of elevated cash rate has left many borrowers unable to make mortgage repayments.

APRA's latest banking statistics revealed more than $14.5 billion worth of outstanding home loans were past due in the March quarter.

The average home loan rate with the financial watchdog's 3% serviceability buffer stood at a record-high 9.3% in the March quarter, effectively locking out many aspiring homebuyers.

Meanwhile, lenders appear less concerned about lowering rates to win new customers.

ANZ noted in its latest housing report the reduced competition among banks amid a continued decline in external refinancing.

ANZ - the first of the Big Four banks to push back its forecast for the first rate cut to February - said refinancing activity is likely to continue to spiral as fewer borrowers roll off their expiring fixed-term loans, seeking instead the lowest variable rate.

That said, it's likely one hell of a hunt as variable rates edge higher.

Newcastle Permanent, Greater Bank up variable rates

Both brands of the second-largest customer-owned bank moved in sync to raise the variable rates on their range of home loan products this week.

Newcastle Greater Mutual Group's Newcastle Permanent applied as much as 20 basis point lift to its investment and residential home loans paying principal and interest (P&I) and interest-only (IO).

Carrying the bank's lowest variable rate of 6.19% p.a. (6.23% p.a. comparison rate) is the Real Deal home loan, which comes with a redraw facility and zero ongoing fees.

Newcastle Permanent also upped the rates on its Premium Plus Package home loans for both residents and investors.

The package home loan's special offer rate with an 80% loan-to-value ratio (LVR) is now 6.24% p.a. (6.58% p.a. comparison rate*) after a 10 basis point lift.

Here are the changes applied to the bank's Real Deal range of mortgages.

Greater Bank, which completes the NGM entity, also upped its variable home loans paying P&I and IO by up to 15 basis points.

New rates offered through the bank's one-year Great Rate and Ultimate Rate home loans for owner-occupiers and investors are as follows:

But unlike its bank sis, Greater Bank didn't stop just altering its variable home loans, as it also dropped the rates on select fixed-term mortgages.

A 30 basis point cut was applied across its investor and owner-occupier fixed home loans on a one-year term.

Both Great Rate Fixed and Ultimate Fixed now offer a 5.99% p.a. advertised rate, with the former's comparison rate at 7.67% p.a. while the latter's is at 7.82% p.a.

Greater Bank's Ultimate Home Loan comes with multiple offset accounts and an option to link a fee-free Visa credit card - features that are not available in Great Rate Home Loan.

MOVE Bank hikes fixed and variable home loans

Brisbane-based MOVE Bank lifted the rates on its standard and offset home loans by as much as 35 basis points.

The Everyday Home Loan carries the member-owned bank's lowest advertised rates on both variable and fixed at 6.09% p.a. and 6.14% p.a.

However, to be eligible for these rates, borrowers are required to maintain a credit of $1,500 a month in a MOVE transaction account.

Meanwhile, the lowest interest rate for a variable home loan with an offset account is 6.29% p.a., while it is 6.14% p.a. for the minority who believe fixing for at least two years would be the better option in a highly uncertain environment.

Here are the newly adjusted variable rates of MOVE's residential home loans paying P&I.

And for fixed rates, changes are shown below:

Read more: Home Loans News Home loan rate changes

Bernadette Lunas

Finance Journalist

Bernadette is a journalist with years of experience covering topics in macroeconomics, real estate, and lifestyle beats for notable print media organisations. She joined the InfoChoice Group in 2024, bringing her passion for writing stories that help Australians make better decisions about money.

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