Over half of homeowners believe banks won’t act in their best interest when it comes time to refinance

Research commissioned by Mortgage Choice confirms that Australian homeowners are sceptical about receiving unbiased advice from a bank when it comes to refinancing a home loan.

January 20, 2021

  • Two out of five (38%) homeowners are either in the process of refinancing or are considering switching to a new loan.

  • One in two (53%) homeowners may be reluctant to speak with a bank for refinancing advice out of concerns they won’t be advised if there is a better deal elsewhere

  • 94% of homeowners trust a mortgage broker’s home loan recommendations, with 55% valuing the support brokers provide comparing different loans, rates and features.

Research commissioned by Mortgage Choice confirms that Australian homeowners are sceptical about receiving unbiased advice from a bank when it comes to refinancing a home loan.

Not the full picture: Banks won’t mention competitors’ deals
As mortgage interest rates hit record lows, Australians are wasting no time securing the best possible home loan deal. The research reveals two out of five (38%) homeowners are either in the process of refinancing or are considering making the move to a new loan.

However, 53% of homeowners are wary that if they speak to a bank they won’t be advised if they could get a similar or better home loan deal elsewhere. One in two (49%) homeowners feel that banks don’t always have their best interests at heart.

High levels of trust for mortgage brokers
The survey results confirmed that a significant majority (94%) of Australian homeowners say they trust the loan recommendations made by a mortgage broker.

For half (55%) of the respondents surveyed, the number one benefit of partnering with a mortgage broker during the refinancing process is professional support comparing loan options, rates and features. For 45% of refinancers, a mortgage broker streamlines the process, “saving time and hassle”.

Susan Mitchell, CEO of Mortgage Choice said, “Faced with what can be an overwhelming choice of home loans, homeowners want to be confident they are making the move to a loan that will improve their financial wellbeing through a lower rate, improved loan features, or both."

“While banks can provide information on their own product suite, they do not have an in-depth understanding of competitors’ products. That is why I urge borrowers in the market for a better deal to engage the help of an experienced mortgage broker to learn what other options they have.”

“Mortgage brokers not only provide a broad selection of loans across a variety of lenders, they also take the time to explain why a particular loan is being recommended. This is very reassuring for consumers and demonstrates that mortgage brokers work in the homeowners’ best interests at all times. This important combination underpins the exceptional level of trust that homeowners place in their mortgage broker,” concluded Ms Mitchell.

About the research
The Mortgage Choice research is based on research commissioned by Mortgage Choice and conducted by CoreData between 14 and 27 October 2020. The research was conducted via a quantitative online survey, gathering a total of 1,023 responses from Australians across the country aged between 21 and 60 years old who are either a ‘First home buyer’ (494 respondents) or a ‘Homeowner/Investor’ (529 respondents).


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