Earlier this month, the Reserve Bank of Australia reduced its official cash rate (OCR) to a record low 1.25 per cent. Many of the major banks have already announced changes to their home loan rates, and home loan experts are urging Australian borrowers to find out if they are eligible for a rate cut. There’s never been a better time to review your mortgage by contacting your Mortgage Express broker.
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This month’s interest rate cut is tipped to be the start of a rate-cutting cycle that could drop the OCR right down to 0.5 per cent within a year, say experts. While a rate cut is an obvious concern for retirees and savers who rely on interest income, it’s something of a bonus for borrowers.
Depending on the amount of your mortgage, you could soon be saving hundreds of dollars a year if your lender passes on the interest rate cut. Potentially, with a $400,000 mortgage, a 0.25 per cent rate cut could save you $700 a year on a principal and interest loan over a 30-year term.
Consumer advocates are urging Australians to review their mortgages and to find out if they’re eligible for a rate cut.
"It does pay to examine your particular situation and not rely on these media releases and media reporting about what the big banks are doing," said Consumer Action Law Centre CEO Gerard Brody.
"A study by the Australian Competition and Consumer Commission (ACCC) last year found there is opaque discretionary pricing in the mortgage market and that most people are not on the relevant headline interest rates that the banks advertise," Brody said.
Get in touch with your Mortgage Express broker to book a review of your existing mortgage or to discuss refinancing to a better rate. It’s vital that borrowers don’t simply assume that rate cuts will apply to their mortgage.
Getting a better rate
When it comes to home loans, finding the biggest savings means shopping around for the lowest rate and negotiating with lenders to cut interest rate costs. A Mortgage Express broker can do all of this for you on your behalf.
Here are some helpful tips to getting a better rate:
1. Ask your Mortgage Express Broker to do research for you, comparing rates across various lenders – then you will know what rates are out there and what the competition is offering.
2. Compare the cost of refinancing against potential savings with a lower interest rate and be prepared to refinance if your existing lender won’t budge on rates.
3. Of course, get professional help from a mortgage broker – our team are skilled at negotiating on your behalf. What’s more, with access to a panel of both bank and non-bank lenders, we can compare lending options and help you make an informed decision.
If you’d like to find out more about a mortgage review with a view to securing a better interest rate, contact one of our brokers today. Simply complete this form and one of our brokers will be in touch to discuss further.
Disclaimer:
While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken by Finservice Pty Ltd (Mortgage Express) for any errors or omissions. This publication does not constitute personalised financial advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. A Disclosure Statement is available on request and free of charge.
Finservice Pty Ltd (Mortgage Express) is authorised as a corporate credit representative (Corporate Credit Representative Number 397386) to engage in credit activities on behalf of BLSSA Pty Ltd (Australian Credit Licence number 391237) ACN 123 600 000 | Full member of MFAA | Member of Australian Financial Complaints Authority (AFCA
