Will the mortgage rate rise further?
7 April 2008
Mortgage rate rises have become the hot topic of discussions about personal finance in the past twelve months, as the consecutive and frequent interest rate rises from the Reserve Bank of Australia (RBA) have put pressure on working families with a mortgage.
Recently, the RBA decided not to raise the target cash rate further for the month of April, leading some to speculate that interest rates may not rise further for the near future. The decision not to raise the interest rate again was partially based on the actions of many banks to raise their own interest rates by more than the official rises of the RBA. This was in keeping with the conservative fiscal policy that the RBA wished to encourage, but has left many wondering whether they can expect to see another mortgage rate rise hitting them in the back pocket.
It may all come down to individual banks if the RBA gets its way. If banks continue to up the mortgage rate according to their own needs, then the RBA will have little reason to keep raising the target. Of course, the target cash rate means very little if your personal mortgage rate is rising faster than every other one. Mortgage refinancing may become far more common, but will likely only mean that the official target cash rate will have to be raised more.
Please visit our home loans page to find a loan with a very competitive mortgage rate.
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