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NAB the latest big four bank to cut variable rates – but only for new customers
NAB has today cut variable home loan rates by up to 0.30 percentage points, but only for new customers.
Since the RBA hikes began in May, analysis from RateCity.com.au shows 23 lenders have now lowered variable rates for new customers, including CBA,Westpac and ANZ.
During this time, existing variable rate customers have seen their rates rise by 1.75 percentage points.
NAB variable rate changes today
| Old rate | New rate | Difference (% points) | |
| Basic variable (owner-occupier P&I) | 3.94% | 3.74% | −0.20% |
| Investor (P&I) | 4.54% | 4.24% | −0.30% |
| Investor (Interest only) | 4.74% | 4.69% | −0.05% |
Source: RateCity.com.au
Big four banks – how much more existing customers could be paying
Borrowers that have stayed with the same bank for several years could be paying hundreds of dollars more a month on their mortgage if they haven’t haggled to get a lower rate.
Analysis from RateCity.com.au shows if someone refinanced their loan three years ago to the lowest variable rate from a big four bank, and has not negotiated since, they would be paying between 0.90 and 1.39 percentage points more than a new customer today.
Estimated existing customer vs new customer variable rates
Assumes customer took out loan in September 2019 and has not negotiated
| Existing customer rate | New customer rate | Difference (% points) | Difference monthly repayment $500K loan | |
| CBA | 4.72% | 3.79% | -0.93% | -$260 |
| Westpac | 4.88% | 3.49% for 2 years then 3.89% | -1.39% for 2 yrs then –0.99% | -$388 |
| NAB | 4.70% | 3.74% | -0.96% | -$268 |
| ANZ | 4.59% | 3.69% | -0.90% | -$250 |
Source: RateCity.com.au. Rates are for owner-occupiers paying principal and interest on the big four bank’s lowest variable rates. New customer rate includes Westpac’s introductory rate. Existing customer rate assumes customer took out loan a loan in September 2019 and has not negotiated any rate reductions. Monthly repayment difference assumes $500,000, 25-year loan today.
Across the mortgage market, the gap between existing owner-occupier variable rates and new customer rates has been growing steadily since September last year.
The latest RBA data shows the gap has widened to 0.47 percentage points by the end of June and is likely to increase in the coming months as the cash rate continues to rise.
Source: RBA housing lending rates.
RateCity.com.au research director, Sally Tindall, said: “NAB has been forced to lower its new customer variable rates to keep up with the competition.”
“With refinancing at record highs and billions of dollars’ worth of fixed loans coming to an end, lenders are cutting variable rates to attract new borrowers,” she said.
“Since the RBA began hiking in May, existing variable customers have seen their rates rise by 1.75 percentage points, yet the big four banks have been handing out discounts to new customers on the side.
“In the last four months, 23 lenders have cut new customer variable rates, and we expect more will follow as competition continues to intensify.
“If you think as a loyal, long-serving customer your bank is doing right by you, double check that’s actually the case. The results could surprise you.
“Log on to your banking app and check what rate you’re paying. While you’re there, work out the exact name of your loan. Then look at your bank’s website to see what rate it’s offering new customers.
“If this rate is lower than what you’re on, then your bank is taking you for a ride,” she said.
Take the 5-minute loyalty test:
- Look up what rate you’re paying: Log onto your banking app or call your bank and ask. Make sure it includes the latest RBA hike.
- Check what your bank is offering NEW customers: look at your bank’s website to see their new customer rates.
- Use a comparison site: See what other lenders might be willing to offer for the same type of loan.
If you’re paying more, your bank has failed the loyalty test. It could be time to haggle or refinance.
Lowest variable rates on RateCity.com.au
From lenders that have announced August RBA hikes
| Lender | Advertised rate |
| Loans.com.au | 3.10% |
| P&N Bank | 3.24% |
| G&C Mutual Bank | 3.24% |
| Gateway Bank | 3.24% |
| Bank First | 3.34% |
Source RateCity.com.au. LVR restrictions may apply.
Big four bank lowest variable rates
| Lender | Advertised rate |
| CBA | 3.79% |
| Westpac | 3.49% for 2 years
then 3.89% |
| NAB | 3.74% |
| ANZ | 3.69% |
Source RateCity.com.au. LVR restrictions may apply.
Disclaimer
This article is over two years old, last updated on August 29, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent home loans articles.
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