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NAB announces changes to home loan variable interest rates

NAB has today announced changes to its variable home loan interest rates for owner occupiers and residential investor borrowers.

From Thursday 31 January 2019, NAB’s advertised Tailored Home Loan variable rates will be as follows:

 

 

Current Advertised Rates Advertised rate as at
Thursday 31 Jan 2019
Owner Occupier Principal and Interest 5.24% p.a. 5.36% p.a. (+0.12% p.a.)
Investor Principal and Interest 5.80% p.a. 5.96% p.a. (+0.16% p.a.)
Owner Occupier Interest Only 5.77% p.a. 5.93% p.a. (+0.16% p.a.)
Investor Interest Only 6.25% p.a. 6.41% p.a. (+0.16% p.a.)

Note: this announcement does not impact NAB’s fixed home loan rates including the First Home Buyer special rate of 3.69% per annum, fixed for two years^.

NAB Chief Customer Officer – Consumer Banking, Mike Baird said the decision to increase rates was not taken lightly as the bank sought to achieve the right balance between rewarding customer loyalty, shareholder outcomes, and responding to sustained increases in funding costs.

These changes come after NAB last September announced it would hold its Standard Variable Rate for as long as possible to recognise and reward its existing customers, when other banks lifted their rates. NAB has not increased its Standard Variable Rate since March 2017.

“Our decision to hold our Standard Variable Rate since September last year, the only major Australian bank to do so, has led to around $70 million remaining in the households of more than 930,000 NAB customers,” Mr Baird said.

“We wanted to reward our existing customers for their loyalty and held off as long as we could despite being subject to the same increasing wholesale funding costs and market pressures as other major lenders.

“We have been deliberate in our approach to limit the impact on owner occupier borrowers by keeping their rates as low as possible to encourage both new and existing customers to pay down their loan sooner.

“We are focused on rewarding our loyal customers including engaging with our home loan customers with our check in program.”

Mr Baird said NAB has been proactively contacting its home loan customers to provide a big picture view of their financial situation and ensure they have the right NAB products and services.

“Through these check ins we’ve advised more than 100,000 customers that they’re ahead on their repayments which gives them flexibility to take a breather on payments if they ever need it,” Mr Baird said.

“We’ve also helped almost 200,000 customers understand how they can save more on interest by setting up an offset account.”

Mr Baird said these initiatives were complemented by a range of other improvements including NAB’s comprehensive drought assistance and relief program and continuing to offer first home buyers a special offer rate of 3.69% per annum, fixed for two years^.

“We’re proud to be backing Australians to meet their home lending needs and encourage our customers to get in touch with us to discuss the right product for them now and into the future,” Mr Baird said.

Customers can request a Home Loan Check In by visiting nab.com.au/checkin, in branch, or by calling 13 22 65.

Background information:   

Based on a $300,000 home loan over a 30-year term:

  • NAB owner occupier customers with a standard variable rate home loan will pay an additional $22 each month on their principal and interest repayments, or $264 each year.
  • NAB customers with an owner occupier interest only variable rate home loan will pay an additional $40 each month on their home loan repayments, or $480 each year.
  • NAB customers with a residential investor principal and interest variable rate home loan will pay an additional $31 each month on their principal and interest repayments, or $372 each year.
  • NAB customers with a residential investor interest only variable rate home loan will pay an additional $40 each month on their home loan repayments, or $480 each year.

^Available for owner occupier, principal and interest customers only. Eligibility criteria apply.

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