 Prepare for rising interest rates
Further signs that the banks will start lifting variable rates for mortgages as industry experts point to late 2009.
RateCity chief executive Damian Smith expects banks will blame rising funding costs and increase mortgage rates by around 15 basis points by the end of the year.
Australian banks can lift rate independently from the Reserve Bank of Australia and all major banks have done so in the past.
"RateCity expects the current average standard variable interest rate of 5.50 per cent may rise to 5.65 per cent before the end of the year," Mr Smith said.
This would lift the monthly repayment on a $270,000 home loan by $24 to $1,682 per month,.
"The good news for borrowers is that there are easy ways to avoid paying unnecessary costs by planning ahead and acting soon," Mr Smith said.
"Australians can easily save thousands of dollars on their home loan by factoring in interest rate rises early and repaying a bit more now."
Mr Smith also comments that the best indicator of what rate banks are paying to borrow their funds is the "90-day bank bill swap rate." As this has risen in recent weeks, borrowers should get ready for this increase to be passed on to them in the interest rate.
RateCity figures does point out that the major banks - ANZ , Commonwealth Bank of Australia, Westpac and National Australia Bank - have left mortgage rates unchanged for many months now.
The RBA has has also kept the official cash rate the same for five consecutive months. So rates could well be due for review.
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