An avalanche of rate hikes over the past 18 months has supersized home loan repayments. But savvy homeowners aren’t panicking. In fact, more mortgage holders than ever before are reaching out to brokers for expert help.
A recent survey by the Mortgage & Finance Association of Australia (MFAA) shows 95% of mortgage brokers are meeting with homeowners who have never used a broker before.
And it’s a move that’s paying off.
The MFAA reports nine out of ten brokers have successfully secured a rate discount for their clients this year.
And more than eight out of ten have helped their clients refinance to a new lender.
It just goes to show that if you’re struggling with mortgage repayments, you don’t have to go it alone.
How much could you slash from your home loan?
Part of a broker’s service involves contacting your current lender to negotiate a lower rate.
But if they don’t come to the party, real savings action can lie in refinancing.
Mozo has done the sums on the savings potential of switching from the average variable rates (6.60% for owner-occupiers; 6.96% for investors) to one of the lowest rate loans on the market.
They found that homeowners and investors in capital cities across the country who switch to a new lender can slash their repayments by $474 per month, on average
That’s as much as $5,691 annually.
Now, the lowest rate loan might not be available to you in your situation (we’d have to help you check), but it does highlight that there are big savings to be made if you can refinance to a lower rate.
What if you have a fixed-rate home loan?
You’ve probably heard about the ‘mortgage cliff’ – it’s a term used to describe the financial shock that homeowners can face when their super-low fixed rate comes to an end.
And we’re not out of the woods (or away from the cliff) just yet.
The Reserve Bank of Australia says around one million borrowers will come off a fixed rate over the next 18 months.
Crazy thing is, a Finder survey shows more than one in ten people with a fixed rate home loan are in the dark about when their fixed rate will end.
That matters because skyrocketing interest rates mean the average mortgage holder farewelling a fixed rate could face a $1,677 hike in their monthly loan repayments.
So if you’re on a fixed-rate home loan, it might be worth checking when the fixed rate period is due to end, and if it’s soon, what options are available to you.
Time to call in the experts
No matter whether you’re feeling the pressure of higher rates, thinking of refinancing, or unsure about what’s happening with your fixed rate, it’s important to reach out for expert help.
Give us a call today for a helping hand with your home loan.
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