Mortgage brokers say interest rates are rising faster than borrowers can score better deals

“Every morning I turn on my computer, my inbox is full of lenders who have raised their fixed rates,” he said.

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He recommends borrowers who can get a good deal from their current lender consider doing so, as applying with another bank takes a few days and rates can rise during that time. Someone changing may want to lock in the rate on the day, which may involve paying a rate lock fee.

The warning comes as ANZ changed its forecast for house prices, predicting an 8% rise in 2022 and a 6% fall in 2023, compared to a previous estimate of a 6% rise. and a decline of 3.5% respectively. The bank said higher mortgage rates would limit house price growth this year and last year’s 20% price increases would not be repeated over the next 12 months.

Atelier Wealth chief executive Aaron Christie-David said borrowers were becoming “hyper aware” of the rate hike, as Commonwealth Bank economists predicted the first cash rate hike could come as early as June .

Some homebuyers have been hit by rising rates between applying for a home loan and a banker assessing the application, he said.

“It becomes incredibly frustrating for them: ‘I applied to this bank because they have a fixed rate, and now they’ve raised it. They don’t have that luxury of time, especially in a world of buyers.

Borrowers could spend less at auction if they know their mortgage costs will be higher.Credit:Peter Rae

Mr Lees said others hoped the change could force competitors to spend less at auction and dampen the buoyancy of the property market, allowing them to buy.

He recommended buyers consider a split loan with a fixed component and a variable component if it worked for them, and said they should understand the limitations of fixed loans, such as breakage fees if a homeowner were to sell.

Andine Mortgage Brokers’ Andrew Kostanski said borrowers weren’t too late to service their home loans if they wanted to, and responded to several inquiries about it.

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“It’s still a great time to mend, and I haven’t said that often in the last 20 years,” he said.

“Experienced people know that rates have never been lower.”

They could also ask their current bank for a better offer, he said, adding that all major banks now offer brokers online rebate approval systems where they can list a competitor’s rate and ask a comparable price.

Sydney Mortgage Broker Director Michael Brown said most borrowers know there is a cash rate hike ahead, the only question is when, after the cheapest offers have come in already dried up.

“It’s not too late to fix, but you’re going to have to do your math based on the full term,” he said.

For example, if someone locks in a price for three years, they may be paying well above the variable offers currently on offer, but can expect to be ahead once the Reserve Bank completes its hike for this cycle.

“The one thing fixed rates have is that they give you the peace of mind of knowing what your cost ceiling is,” he said.

“I don’t think you can stick your head in the sand and pretend [a rate rise] do not come.

“You better have a discussion about whether or not it was appropriate to do something to protect your position.”

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