Last month, there was hope that we may have reached the peak of the rate hikes. However these hope were shattered last Tuesday when the Reserve Bank took it up a notch again, lifting the cash rate by 0.25%. All major lenders passed on the rate rise to variable rate borrowers, resulting in higher loan repayments.
While the Reserve Bank acknowledges the pressure being felt by households as a result of the 11 rate rises we’ve endured since May last year, they have made it clear that more rate increases may be needed to curb inflation. Incoming economic date in June and August will direct the Reserve Bank’s future decisions.
Once again, our message to borrowers:
- Review your loan account to check what your current repayment amount is, and what it will be when the latest rate increase comes into effect – use the home loan repayment calculators on our website or contact us and we’ll calculate the new payment amount for you.
- Review your household budget to ensure you can manage higher loan repayments.
- If you haven’t spoken with us recently about your rate, call us. We’ll scan the market to check it’s still competitive and or identify whether there may be an opportunity to negotiate a better rate with your existing lender.
- If you are on a fixed rate, contact us to discuss what your options are when your fixed rate expires.
- Consider what your repayments could be if rates continue to rise and review your budget for these scenarios. Use the home loan repayment calculators on our website or contact us and we’ll crunch the numbers for you.
Most importantly, if you are concerned about higher repayments, please contact us to discuss options. We’re here to help.
This article was published on June 8 2023. It is intended for general information purposes only. It has not taken any individual personal circumstances into account. It’s important to consider your circumstances before deciding what’s right for you. You should seek qualified advice before making decisions. Please talk to your mortgage broker or Court Financial Services about your specific situation.
