Why Home Loan Rate Complacency Costs

With interest rates at the lowest they have ever been in Australia, it's amazes me that a lot of my Scarborough and Osborne Park clients don’t actually know what they are currently paying on their home loan.

A recent survey conducted by Galaxy Research found that 7 out of 10 customers admitted they had experienced mortgage stress when trying to meet their monthly repayments.

Out of this, a staggering 30 percent said that they hadn’t considered taking any action after the May interest rate cut from the RBA because it “would not be worth the effort”.

Why Loyalty is Costing You

When I’m speaking to existing home loan holders in the Scarborough and Osborne Park area, I keep hearing the same thing time and time again. Clients always feel that the process of changing banks is too hard, and not worth the effort.

And that’s exactly what the bank wants you to think!!

The reality is that by using a mortgage broker the back and forth with the bank is all taken care of, and that’s in addition to the fact that switching banks can potentially save you a decent amount of cash as well.

Let’s look at the figures.

For a current loan of $300,000 where you’re paying 4.50%, switching to a loan with an interest rate of 3.67% could potentially save you up to $200 in interest per month. I'm sure you can work this out on your own but to save you the trouble, that's up to $2400 per year!! Money that could certainly be put to better use by helping to pay down your home loan sooner.

Let Us Give You a Comparison

The easiest way to see if there’s any chance you’re paying too much is to let us do the hard work for you. With our lender panel we can compare your loan with hundreds of products, and give you an idea of whether it is actually worth switching or not. We also include all the costs of switching banks so you know the true comparison. Better still, our home loan service comes at no cost to you. We are paid by lenders, and are paid the same no matter which loan you select from our panel.

To take advantage of record low interest rates, don’t delay. Call me, Jason Coviello at Mortgage Choice in Scarborough on 0438 211 745, or send through any questions via email to jason.coviello@mortgagechoice.com.au

If you’d rather be social about it, feel free to head across to my Facebook Page and see if there’s already an answer to your question or pm me.

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Posted in: Refinancing

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