Homeowners who are not making any changes to their current home loans over the past few months could be missing out on potential savings.
According to the Lendi Loyalty Index, banks are charging new customers rates that are 86bps lower than rates charged to existing customers.
Meanwhile, the major banks are charging 91bps less for new borrowers.
In dollar terms, a difference of 91bps on a $500,000 loan equates to more than $2,500 savings per year or around $70,000 over the life of the loan.
“Homeowners who refinance today and save on their ‘loyalty tax’ could potentially reclaim the last two RBA rate increases and tens of thousands of dollars over the life of their mortgage,” Lendi said.
“This data shows all Australians with a mortgage should be actively interrogating their loan and seeking improvement, through reaching out to a broker and assessing their options.”
It's Simple Finance founder Joseph Daoud said it is important for borrowers to assess their current financial health before making any moves to change their mortgages.
“Many people are unaware that they may have moved off an introductory rate and are actually paying between 5-6% on their interest — they should look at their statements, see how much their rate has increased and look to refinance from this position,” he said.
Mr Daoud said those whose fixed rates are expiring over the next few months should consider reaching out to their lenders to find out whether an arrangement would be available that would help them save, especially amid the rising rate trend.
“Some people may be unaware that they are on a 'standard variable rate’, which will fluctuate more if not properly looked at or managed; they should look at their statements and see how much their rate has increased and look to refinance from this position,” he said.
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