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Almost 1 million mortgage-holders don’t check their rate; Are you one of them?
Borrow
Almost 1 million mortgage-holders don’t check their rate; Are you one of them?
Australians are taking out a mortgage and holding it for the duration, which is potentially costing them thousands despite the record-low interest rate, new research has found.
Almost 1 million mortgage-holders don’t check their rate; Are you one of them?
Australians are taking out a mortgage and holding it for the duration, which is potentially costing them thousands despite the record-low interest rate, new research has found.
Figures released by Canstar show that close to 16 per cent, or nearly 1 million mortgage-holders, have not asked to change the rate since signing on for the mortgage.
Steve Mickenbecker, Canstar’s personal finance expert, said buying your next home is a reason to get your finances in order, but it shouldn’t be the only time you check in on your home loan.
“Anyone with a home loan regardless of whether you’re looking to sell or stay put, who hasn’t checked to see what’s on offer right now, could be shortchanging themselves hard-earned money,” said Mr Mickenbecker.
The finance expert explained that in a low interest environment, property owners who have not checked their mortgage could be paying too much.
“Rates are so low, but there is still a wide gap. The lowest variable rate on Canstar today is 2.19 per cent, an amazing 1.28 per cent below the average variable rate of 3.47 per cent,” he explained.
By switching to a better rate, Mr Mickenbecker showed that Aussie households can save thousands a year.
“That is a potential saving of approximately $272 a month on a $400,000 loan, or just over $3,200 a year back into the mortgage-holder’s pocket,” he said.
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- Deferrals skyrocket as COVID-19 sets in
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