Kiwibank is third lender to announce big increase in home loan rates

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PHOTO: Kiwibank is increasing a range of rates.

According to STUFF Kiwibank has lifted a range of its fixed-rate home loan terms.

Its six-month special rate lifts from 5.45% to 5.95%. Its one-year rate rises from 5.39% to 5.89%, its two-year from 5.65% to 6.15%, three-year from 5.89% to 6.29%, four-year from 5.99% to 6.39% and five-year from 5.99% to 6.39%.

Standard rates, which are available to people who do not qualify for special rates, were lifting by a similar margin. The five-year fixed standard rate is now 7.19%.

A Kiwibank spokesperson said the bank was offering tips for people worried about managing a rising interest rate environment, including planning ahead, reviewing expenses, getting their home loan structure right, consolidating debt and maintaining good habits.

“Managing the household budget collectively may help identify opportunities to be as cost-effective as possible.

“For example, are there multiple subscriptions to services where you could simplify to one? Could you set up a separate account for discretionary spending? Or, agree on what are the ‘must haves’ versus the ‘nice-to-haves’,” it said.

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“While we don’t know how long rates will be increasing for and how high rates will go, maintaining good habits you introduce during the economic cycle can help prepare you for potential rate increases in the future.

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“For example, higher interest rates will mean higher minimum repayments. When rates start to go back down, if you keep your payments the same you’ll be paying more principal off your loan faster, while maintaining a buffer should your minimum repayments increase again in the future.”

Westpac said on Thursday that it was lifting home loan rates by between 44 basis points and 54bps.

Its one-year special rate was to increase by 54bps to 5.99% and its two-year special by 44bps to 6.19%.

Rates for those who did not have at least 20% equity to qualify for “special” rates range from 6.59% for six-month and one-year terms, through to 6.89% for five years.

It followed ANZ’s announcement on Wednesday that it would increase its fixed-term mortgage rates.