New research from Canstar reveals that an owner-occupier who took out a mortgage five years ago and has not renegotiated since will now face a variable rate of 7.01 per cent after the latest Reserve Bank rate hike is passed on. By switching to a highly competitive rate of 5.99 per cent, a borrower with a $600,000 loan could potentially save over $11,000 in the next two years, even after accounting for $1,150 in switching costs.
Expert advice: Take a day off to review finances
Sally Tindall, Canstar's Director of Data Insights, told the 7NEWS Podcast The Issue that Australians should consider taking a day off work to thoroughly review their finances. "If you're checking your rate this weekend, make sure it's competitive," Tindall said. "You may as well jump on the phone to your bank and ask them for a rate cut, haggle with them, tell them that you're thinking about switching. If they think you're a flight risk, they're more inclined to pay attention to what you're going to say."
Further rate hikes on the horizon
Several major banks are forecasting additional interest rate increases. NAB's economic team has raised its cash rate forecast, predicting another 0.25 per cent hike in June. Westpac already expects further hikes, with two more pencilled in for June and August. Meanwhile, CBA and ANZ anticipate no further increases, though both acknowledge the risk of a hike in August.
Budget move criticised
Before becoming a finance expert, Tindall worked as an adviser for Australia's first female Prime Minister, Julia Gillard. She expressed concern over a decision the Albanese Government is expected to announce in Tuesday's federal budget, which has left her "scratching her head." Treasurer Jim Chalmers is reportedly planning a $200 to $300 tax offset for all workers from July 1, 2027. Tindall argues this move will worsen the economy for Australians. "You've got the government giving widespread handouts and that's just going to fuel the inflation fire even further," she said. "You've got the government handing out a fuel excise cut, giving money back at the bowser, but then borrowers are handing it back to the banks in higher interest rates. The left hand is not talking to the right hand. They need to be working together. The government needs to start doing more to rein in inflation."
For more insights, tune into The Issue on Listnr or watch full episodes on YouTube.
