Want to save money? Check your mortgage, not your shopping bill

Want to save money? Check your mortgage, not your shopping bill

New research has found that 78% of Australian borrowers check up on their everyday expenses, while only 54% do the same when it comes to their mortgage.

When speaking to yourmortgage.com.au, Kevin Sherman of myrate.com.au said small changes to fees and interest rates can make a big difference to your total mortgage costs.

“Refinancing your more expensive home loan is often a very simple process and the thousands of dollars of potential savings are well worth the effort,” he said.

So, how come we’re more likely to notice our food-shopping bill over one of the biggest investments we’re likely to make in a lifetime?

Here’s what you need to know.

A home loan is not ‘set and forget’ 

Reviewing your home loan may seem overwhelming, but simply taking an hour out every 12 months can save you a considerable amount over the entire term of your loan.

David Hyman, the Managing Director at Lendi told news.com.au that customers can easily be getting gouged by their lender if they fail to do regular checks, particularly after many banks hiked variable rates.

He went on to say many borrowers were paying more than they needed to, simply by sticking to old rates.

“We see owner occupier customers coming through on rates in the5% range today, it’s insane,” he said.

“The lowest rate available is 3.65% or thereabouts but there are lots of customers on old rates.” 

What are rates doing now? 

Hyman told news.com.authat some interest rates are hitting as high as 5.74%, and although investors have to pay marginally higher rates, they should be aiming to be as close to 4% as they can.

Recently, every one of the Big Banks (except for NAB), increased variable rates for investors and owner occupiers.

This increase adds hundreds of additional dollars to the loans of many mortgage holders. Switching to a more attractive loan is simple solution. 

But, what about loyalty to your lender? 

CEO of The Mortgage and Finance Association of Australia (MFAA), Mike Felton, told news.com.au that being loyal doesn’t actually pay off. 

Why being loyal to a lender doesn’t reap returns 

Felton explained why continuing to be loyal to a lender doesn’t necessarily result in savings for the borrower.

“The lenders offer better deals to new customers than the deals they offer to existing customers,” he said.

“I think it’s in everybody’s interests that they should be making additional repayments if they can. If you don’t have the ability to do it yourselves then get help, ask a mortgage broker.”

Need a home loan check-up?

Contact us about reviewing your existing mortgage, or securing one that matches your goals while also saving you more.

If your refinancing, we handle the whole process, just like if you were securing a new loan for your home or investment property.

Unlike the banks, we’re not aligned with any lender, and have access to hundreds of finance products, which means we can pinpoint a loan that is right for you.

Get started now.

Financial Advice Disclaimer: This information is general in nature. Mortgage brokers do not provide financial advice. Clients seeking financial advice will be referred to a qualified financial planner.