We have just been notified our lender has increased the interest rate on our home loan by 0.10%. Before we call them I am interested to find out if other lenders doing the same and if so, why?

Hi Lindsey,
Unfortunately around half of lenders have started to either wind back their discount rates or to increase their rates for new and existing borrowers. The reason given is that the global cost of funds has risen since the US election and the December US Fed rate increase. There is now an expectation that the US may see two or more increases this year as well.
I would suggest that you speak to a trusted broker and evaluate which loan type and rate is best suited to your needs
Good luck
Regards
Scott

Hi there Lindsey.
Yes unfortunately most lenders have increased their rates from .10% to .15% per annum due to the cost of wholesale funds increasing. You may have seen something in the news of late about the American dollar and the profitability in the economy in the world which is the US. Anyway it just means we have to pay a little more.

We are expecting that rates will increase further during the year with possibly the RBA making two increases during 2017. A lot will depend on how the economy is going and the pressure on real estate prices.

It is always a good idea to keep your options open as products change all the time. It's always handy to see whether or not there are better options available in the market and the cost to switch. So, talking to a mortgage broker every couple of years to reassess your options is a sensible strategy.

You might also think about fixing some of your mortgage if you think that rates will rise beyond the current variable over the medium to longer term (say 3 to 5 years)

Quite a few lenders have recently increased rates. .10% is on the lower end, I've seen some banks go up at high at .50%

Definitely worth shopping around to see if you can do better. Most brokers have access to over 30 lenders.