Mortgage holders cop another rate hit as savings crack 6pc for the first time in over a decade
The big four have passed on another rate rise to mortgage holders while savers finally have a shot at earning 6 per cent. But miss the fine print and your bank could pay you just 0.01 per cent.
Mortgage holders will cop another interest rate whack from Friday as the big four banks lift home loan charges, while the best ongoing savings rates crack 6 per cent for the first time in more than a decade.
Commonwealth Bank, Westpac, NAB and ANZ have passed on the Reserve Bank’s latest quarter-point hike in full, after its September 29 decision took the cash rate to 4.6 per cent.
For savers, the 6 per cent offers come with strings attached. Bank of Queensland is restricting its top rate to customers aged 14 to 35, while Newcastle Permanent’s deal is for under-25s. Both demand that customers meet monthly conditions.
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By continuing you agree to our Terms and Privacy Policy.Borrowers have fewer reasons to celebrate with Canstar estimating this year’s four hikes will add $364 a month to minimum repayments on a $600,000 mortgage, based on a loan with 25 years remaining in February.
“This is going to be brutal for some borrowers who are lugging around super-sized debts attached to rates that could soon easily start with a 7,” Canstar data insights director Sally Tindall said.
The last big-bank home loan rate starting with a five has disappeared.
Westpac’s cheapest variable offering has climbed to 6.24 per cent, with NAB at 6.29 per cent, Commonwealth Bank at 6.34 per cent and ANZ at 6.50 per cent.
The higher interest charges kick in immediately, though borrowers could have another two or three months before their banks increase minimum repayments.
Savers face a different headache, with the big four having passed on most of the latest rate rise to their bonus savings accounts but left the base rates near zero for customers who fail to meet monthly conditions.
NAB and ANZ customers who miss those requirements could earn just 0.01 per cent interest. Westpac and Commonwealth Bank pay only 0.10 per cent on their main bonus savings accounts.
“If you aren’t actively tracking your account criteria every single month, your bank could well be keeping the extra interest for itself,” Ms Tindall warned.
Westpac’s young adult Life account now offers 5.95 per cent for eligible customers, while the maximum rate on Commonwealth Bank’s GoalSaver and NAB’s Reward Saver accounts stands at 5.25 per cent.
For savers unwilling to jump through monthly hoops, AMP offers 5.50 per cent on balances up to $50,000 without such conditions.
ING offers an introductory 6.25 per cent for four months before the rate drops to 5.65 per cent.
Originally published as Mortgage holders cop another rate hit as savings crack 6pc for the first time in over a decade
