Comment: Come on Australian Home Loan borrowers, we need to reverse these headlines
• 85% of Australian mortgage holders don’t know their home loan rate
• Most Australian home loan customers are paying way more than needed on their mortgage
Let’s be more proactive to find out the interest rate on our home loans and call your lender today to get a better rate. If you’re not sure how simply ask a question or call your mortgage or finance broker to help.
Could one call save you thousands?
Too true Paul ...... we are having many proactive conversations right now with @Announcer clients reviewing rates, budgets and restructuring loans to obtain the best rates, reduce interest costs but also working hard to repay the debt in the most economical way!
1. Find out what your rates are.
2. Do a budget.
3. Seek advice.....biased towards using a Mortgage Broker :)
Check out a our little video on the simple things we are doing at HQ!
There is always room to join the @Announcer club, call us to enquire about our membership :) or post your questions on simplyaskit and we will will help!
Have a great weekend!
I think there are two parts to this.
Firstly a general apathy and people not wanting to go to the trouble of changing all their direct debits etc. Not realising that a mortgage broker can often negotiate with your current lender and help them get their rate down without changing.
Secondly, the fact that people just don't realise that their are better offers out in the market place and are deceived by the major Banks into thinking they have a great deal. For example the lender who tells a client they are getting a 1% discount of their home loan rate compared to all the other people with the Bank. What the lender doesn't say is that everyone else who isn't offering a discount didn't start with an inflated rate at the beginning. I have actually had a heated discussion with a client who was with a BIG 4 lender who wouldn't change unless I could get him more than a 1% discount. Didn't matter that the interest rate was already below what he was paying. Unless he received a 1% discount he wasn't going to change.
I actually don't understand sometimes how this is permissible, I mean if a car yard put up the prices of all their cars by $5,000 and then had a $4,995 off sale I am pretty sure the ACCC would be onto them.
I think the first step would be to have a true Government regulated Standard variable interest rates and then require all lenders to publish the rate range on peoples Bank Statements. This would allow people to see if they were paying at the bottom or the top of the range and make informed decisions about the features they need compared to the interest rate.
Yes it seems to me there are three types of people,
Type one is super proactive to the point of being a little annoying, who are regularly checking lenders and comparison websites for the best rate. These people call at least once a month to discuss their interest rate and check they still have the right product. This would be the 15% who do know what their interest rate is.
Then in the second 85% who don’t know their rate, there are two types. The first group trust their mortgage broker or financial planner to keep in touch with them on regular basis and probably don’t know their current rate but would have had it checked in the last twelve month.
To me, there then appears to be a third group, who if feel make up about 50% of all mortgage holders. The borrower has no idea what rate they are on and probably haven’t thought about their loan since the day they took it out. They can tell you how much they pay month to month, but often have no idea of the balance of their loan or the rate they are paying. The only time these people seem to think about changing lenders is when rates go up and the repayments become a little uncomfortable. For many though if that discomfort never comes they will barely even look at their statements. The best example we have is many years ago when a client earning more per month than the balance of his loan and still paying $495 per year for an annual package and an interest rate nearly 3% higher than it should have been. The only reason he found any of this out is that he came to us to see if he could purchase an investment property and we asked for his last home loan statement. He promptly paid off his home loan the next day.
Lenders work for Lenders – they want to make as much profit of a client as possible. They are not going to tell you about a cheaper loan that makes them less money.
Only Mortgage brokers and Financial Planner are working for the borrower
Rebecca A Mitchell
Awesome Lending Solutions