Aussies are refinancing with non-major lenders, study shows
"Non-major lenders" are proving to be increasingly popular among Aussie mortgage customers who are looking to refinance their home loan.
According to a new study conducted by AFG, smaller, less established companies are clawing back some market share from the nation's "big four" banks.
Smaller lenders accounted for 24.3 per cent of the overall mortgage market last month – up from 19.6 per cent in October 2011.
The home loan sector is said to be worth $300 billion in Australia and non-major businesses are now getting a bigger piece of the pie.
Although there is still a long way to go before they catch up with their more illustrious rivals, it is clear that smaller lenders have finally caught the attention of the Australian public.
General manager of sales and operations at AFG Mark Hewitt highlighted a recent government study that showed 45 per cent of people are not sure if they have the best home loan deal.
"This lack of confidence is translating into refinancing which in recent months has been working to the advantage of non-major lenders," he remarked.
"Suncorp remain the dominant non-major, but we've also seen Macquarie Bank strengthen in recent months, and ME Bank has also made rapid inroads in a very short space of time."
In October 2011, just 19.4 per cent of mortgage customers refinanced with a smaller lender, but this figure had risen to 28.7 per cent in September 2012.
A study recently conducted by Ernst & Jones indicated that 65 per cent of Aussies feel they should receive greater rewards from their home loan provider for remaining loyal.
The research highlighted just how much competition there is in the market and more than three-quarters of the survey respondents said they had no idea which bank they wanted to switch to.
This is why comparison websites have become so important, as people can easily and conveniently run the rule over the best and worst mortgages in the country.
Have a question about home loans? Ask the money gurus at Mozo Answers.