1 in 4 Aussies ignorant of interest on home loans

Tuesday 22 February 2011

Article by Mozo

A significant proportion of Australians are still in the dark over how much interest they pay on their home loans, new research has found.

Many Aussies don't know their home loan interest rates

While the tough economic climate has prompted many households to get a firmer grip on money matters, the findings of the new study show that as many as one in four homeowners don't know what rate of interest they are paying on their mortgage.

This is in spite of the fact that around half of those polled by Mortgage Choice cited interest rates as their number one economic concern, with the cost of living only their second-biggest concern.

Furthermore, the research also revealed that around one in five mortgage-holders have also racked up significant levels of debt away from their home loans, often using credit cards or other personal loans to fund renovations or a new car.

"These results go a long way to demonstrating how mortgage stress is very often caused by additional debt people commit to after they take out their mortgage," the company's spokesperson Kristy Sheppard said of the findings.

This comes soon after the same firm reported that a spate of recent interest rate rises has prompted many Australians to turn to fixed-rate home loans rather than variable mortgages.

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