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Over the past two years, nearly half of the Australian homebuyers have been affected by out of turn rate hikes on their mortgage, despite the RBA maintaining a low cash rate of 1.50 percent for the longest time. At the same time, banks are offering lucrative deals and discounts to new customers that many of the loyal, existing customers are missing out on.

 
How existing home borrowers can save more money on their home loan
 


Lower rates for new borrowers

On the HashChing database, nearly 25% of HashChing deals (borrowing 80% of the loan amount) are less than 3.70 percent per annum to new customers. While 4.00 percent per annum was the golden standard some time back, today, if you are paying 4.00 percent per annum on your home loan, you are probably paying too much interest to your bank.

Talking about existing home loan customers, a new survey reveals that unexpected rate hikes have hit almost half of the Australian borrowers. Research also indicates a higher level of dissatisfaction amongst the customers of the big banks. Yet, they are unwilling to switch lenders.

The reason? Many homebuyers think they are on the best deal offered by their lender, when, in reality, most banks are offering the best deals to new customers and hiking the rates for existing customers. In addition to ignorance, the unwillingness to switch could also be a product of laziness or the fear of lengthy paperwork, which is unfounded.

“In case you haven’t checked your home loan rate lately, it is time to do so,” says Susan, a mortgage broker with HashChing. “With most lenders offering rates starting at three point something to new customers, it is likely you can find a more competitive deal with another lender and potentially save a lot of money on your home loan,” she adds.

Susan explains her point by citing John’s example. John had a $400,000 mortgage for 25 years at a rate of 4.00 percent per annum with one of the major banks. He made a monthly repayment of $2,111.35 towards his home loan that would have cost him $633,404.21 over the full term. A couple of months back, he decided to shop for a better deal and started comparing mortgage rates online on HashChing. Eventually, he decided to refinance with a smaller lender that offered the same terms as his existing mortgage but at a lower rate of 3.70 percent. As a result, John’s monthly repayments reduced by $65.69. With his new rate, John can potentially save $19,707.70 over the life of the loan.


Refinancing is Easy!

Over two-thirds Australians don’t know the interest rate on their home loan. If that sounds like you, you might be wasting thousands of dollars each year in interest. Experts say that it is best to review your home loan every few months to ensure you are on the best possible deal in the market.

Refinancing your home loan is quick and easy. Besides, a few hours spent in shopping around for a better deal can save you a significant amount of money that can be used to pay off your debt faster, effortlessly.

We recommend that you start by comparing home loan deals offered by various financial institutions to know how your interest rate stacks up against the competition. You can use the mortgage comparison tool on HashChing to compare broker pre-negotiated home loan deals from over 60 lenders across Australia.

Once you zero down on a home loan product, hit on the ‘Get me this deal’ button that will lead you to a page wherein you are required to fill in your details so that a verified mortgage broker can contact you. And that’s about it! Your HashChing mortgage broker would take over from this point, doing all the legwork on your behalf, helping you switch to a better deal with minimum fuss. In case you have any queries, or would like to understand your options better, you could always get in touch with an expert by posting your questions online. Our verified mortgage brokers will answer your questions promptly, helping you make informed home loan decisions. Don’t worry; your information is safe with us. You won’t receive any unwanted calls or messages.

HashChing is Australia’s first online mortgage marketplace that allows users to compare broker-negotiated mortgage rates from over 60 lenders across Australia. Users can also post their home loan queries online to have them resolved by experts in a transparent manner, free of cost.

 

By Vidhu Bajaj,
HashChing Content Writer

 

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HashChing is helping Australians by providing access to the pre-negotiated home loan deals. Obligation free consultation with one of our partner brokers might save you time, hassle and money.

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