Everyone’s talking about it, but most aren’t doing anything about it.
By the way…I’m talking about their homes loans,
A recent survey by non-bank lender State Custodians Home Loans found that homeowners admit they’d like a cheaper home loan but aren’t putting enough hard graft into actively searching around for better home loan rates despite flatlining wages and record amounts of household debt.
A nationwide survey of 1,006 people discovered that:
- Only 13 per cent of all respondents say they are always on the lookout for better home loan rates.
- One third (33 per cent) of Aussies are apathetic about shopping around their home loan deal in one way or another.
- One in six people (17 per cent) admitted that whilst they’d like to look for a better deal, they either weren’t sure how to go about it, didn’t have the time or couldn’t be bothered.
- Meanwhile 16 per cent say they wouldn’t even consider shopping for a better rate.
State Custodians general manager Joanna Pretty says it’s worth customers simply asking their current lenders every now and then whether there’s an option of a cheaper deal.
“It’s definitely worthwhile to quiz your lender or mortgage broker to make sure you’re constantly getting the right deal for your situation,” she says.
“You’re dealing with a lot of money so it’s not in your best interests to just forget about your loan.”
Too much of a hassle
Ms Pretty adds that many people have an idea that reviewing a current home loan will be a big hassle.
However, she says it usually requires little more than a phone call.
“You may be pleasantly surprised at the outcome. Even if you get a small discount, that can end up making a big difference overall which is surely worth making a call once in a while.”
Of the Australians who do make the effort to look around for better home loans:
- 19 per cent of Gen X look every one to two years, and 12 per cent look every year.
- Gen Y has 20 per cent looking within one to two years, and 12 per cent investigate yearly.
- Those aged 50 plus were the least likely to shop around their rate.
- Only 14 per cent of Aussies in this age category would look to change loans every three to five years, and
- Just 11 per cent would think about a new deal at the one to two year mark.
Men are more likley to shop around
Overall men (73 per cent) are more likely than women (59 per cent) to shop their mortgage to see if they can get a better rate or overall deal from a different financial institution.
Men are more likely to look around every two years or more often (48 per cent) compared to 31 per cent of women.
Women (23 per cent) are also more likely than men (13 per cent) to say they’d like to shop for a better deal but don’t have the time or inclination.
“It’s a fact that many of us are time poor these days, particularly if you’re working and juggling home and family life. However, if you would like a cheaper loan, particularly if you are financially struggling, then it can be really worthwhile shopping around,” says Ms Pretty. “A little effort may end up going a long way.”
About the research: The study was conducted by Galaxy Research between 7-10 April, 2017. The survey was administered online amongst a nationally representative sample of 1,006 Australians aged 18 years and older covering: NSW, ACT, VIC, TAS, QLD, SA and WA.
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