One of the primary ‘weapons’ banks utilise, is to take advantage of lazy borrowers.
Merry Christmas, go back and read the headline again. If it is news to you, then I’ve just given you one of the best early Christmas presents you can get.
Let me explain.
Our interest rates have headed down over the last few months and the banks have passed on some but not all of the savings to you, much to the government’s ire. A decrease in the cash rate of 0.25% does not mean the banks’ costs reduce by the same amount. So, it is not realistic to expect the full decrease in the cash rate to be passed on.
There is a big ‘but’ coming…
Different lenders have different cost bases. That means some ‘non-major’ bank lenders have a massive cost advantage in this environment and therefore have an ability to offer you significantly lower rates. Just because your current lender didn’t pass on the full rate doesn’t mean other lenders don’t have a better deal.
This is why you can’t afford to be another ‘lazy borrower’ and play into their hands.
Every time the RBA changes interest rates it resets the market for the best deal on a mortgage. When you ‘set and forget’ your home loan, the bank pockets those extra profits.
The fact is ‘New-to-bank’ customers are offered rates significantly lower than existing customers. If your loan is 5 years old you are paying too much (no matter who your lender is).
If you want to find the best deal for yourself in the current market you basically need to go to every lender find out what their best deal for you is and then pick the best one. Unfortunately not all lenders deal directly with the public, not all loan officers are equally knowledgeable about the products their institution offers. So for all that work you might still miss out on the best deal.
Your best bet for getting the best possible loan is to get in touch on 03 9511 8883, email support@ifafinance.com.au or contact your broker directly to arrange a no-cost, no-obligation mortgage review. As a result of one current review in progress a new-to-Integrity client will save over $8,000 per year in interest!
Daryl Borden