The banks who have increased interest rates in 2019

Cash-strapped mortgage customers should brace themselves for more interest rate increases as lenders push up their charges.

Multiple financial institutions including National Australia Bank have lifted rates this year, pulling on the purse strings of households paying off their homes.

Despite the Reserve Bank of Australia board keeping the cash rate on hold at 1.5 per cent last week, experts say borrowers could expect more variable rate rises in the coming months.

Lenders have blamed the increases on the rising cost of funding.

New analysis by financial comparison website Mozo showed so far this year lenders including NAB, ING, ME, Macquarie, Bank of Queensland and Defence Bank have all announced owner occupier variable rate hikes.

BOQ has made the biggest increase this year, lifting their package variable rate by 0.18 percentage points to 5.03 per cent.

This has added an extra $33 a month or nearly $400 a year for an owner occupier borrower paying principal and interest.

Mozo spokeswoman Kirsty Lamont said “it’s highly likely” that more rate hikes are on the horizon.

“We’ve got a slowing mortgage market and we’ve got higher than usual cost of funding which means that lenders are seeking to tweak their profit margins,” she said

“It’s definitely time to assess your mortgage and your capacity to be able to afford another rate increase, it could be worth trying to refinance to a lower rate home loan.”

In recent months lenders have revealed they have drilled down into intricate spending behaviours of customers, including how much they spend on expenses such as Uber and Netflix.

Banks have been put under the spotlight during the financial services Royal Commission and many have taken action by cutting back on how much money they lend.

1300homeloan director John Kolenda said owner occupiers should be hunting for deals lower than four per cent and as low as 3.5 per cent.

“There’s a much more complex and forensic look at living expenses which has flushed through all the banking organisations,” Mr Kolenda said.

“It’s extremely difficult to refinance and it’s extremely difficult to borrow money in the current environment without actually going through a whole more forensic expenses.”

CommSec’s senior economist Ryan Felsman said the standard variable rate across all lenders has increased by 0.15 to 0.2 percentage points since the end of last year, increasing to 5.35 per cent.

RBA governor Philip Lowe last week revealed the chances of a cash rate hike or cut were now “evenly balanced”.