Why are some banks increasing their interest rates and others are not?

• Interest rates can vary by as much as 1.5% between owner occupied with Principal & Interest repayments and investments with Interest only repayments

• The Government regulator is focusing on families paying off their household debt and improving their balance sheets

• Loans structured as Owner Occupied Principal & Interest are the cheapest to access

• With interest only investment loans at a higher rate the property market has slowed

• The banks have made their decision around the differentiation of interest rates on loans; so going forward any further movement will be due to the cost of funds

What can you do to mitigate the risk? It's a good time for you to review your loans and compare repayment options, either variable, fixed or a combination of both.