Give yourself a Christmas bonus with this easy home loan trick

Tom Watson

15 Dec 2018

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The clock’s ticking down to Christmas. In fact, there are just ten days to go.

If you’re organised that means your presents for the family have been bought, wrapped and are now sitting under the tree. But why not keep that festive cheer going with a present of your own in the form of a Christmas bonus.

For Aussies with a home loan that may be easier to achieve than than you would think, and it all comes down to one word - refinancing.

RELATED: Bargains to record breakers: Australia’s cheapest and most expensive properties of 2018

While the idea of refinancing your home loan might not get you quite as excited as unwrapping a new smart tv or concert tickets, with thousands of dollars in potential savings in store Mozo Director, Kirsty Lamont, suggested it could be well worth the effort - especially if you’ve seen your rate hiked recently.

“From the big banks to the smaller lenders, many Aussie homeowners will have been whacked with one, if not more rate increases from their banks during the year,” she said.

“The good news is that it’s never too late in the year to take action. Homeowners looking to refinance can still take advantage of one of the many low rate deals on the market and give themselves a real Christmas bonus to end 2018.”

Home loan offers 2018 - rates updated daily

  • Promoted

    loans.com.au

    2.88% p.a.

    2.90% p.a.

    $1234

    Product details Close details
    Smart Home Loan

    A low-rate home loan that could save you thousands. No application or ongoing fees. Unlimited additional repayments. Unlimited free redraws with no minimum redraw amount, Limited time only.

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • 2.88% p.a.

    • 2.90% p.a.

    • $520

    • 80.00%

    • $50,000

    • $1,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Smart Home Loan

  • Promoted

    UBank

    2.84% p.a.

    2.84% p.a.

    $1234

    Product details Close details
    UHomeLoan - Discount Offer

    Free redraw with flexible repayments. Min 20% deposit. Winner of a Mozo Experts Choice Award 2019 in the Low Cost Home Loan category^.

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • 2.84% p.a.

    • 2.84% p.a.

    • $0

    • 80.00%

    • $200,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the UHomeLoan - Discount Offer

  • Promoted

    ANZ

    3.24% p.a.

    3.28% p.a.

    $1234

    Product details Close details
    Simplicity PLUS Special Offer LVR <80%

    Low rate. No ongoing fees. Can make extra repayments & redraw. Min. 20% deposit. Apply by 31/01/20 and settle by 30/04/20 for $2,500 cashback on eligible refinanced loans of $250K+ (incl. any new lending). Offer terms, fees, charges and elig. criteria apply.

    • $0.00

    • $160.00

    • yes - free

    • yes

    • no

    • 3.24% p.a.

    • 3.28% p.a.

    • $0

    • 80.00%

    • $50,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    • Refinance by 31 January 2020 to receive up to $3,500 cash back depending on the loan amount with an ANZ linked transaction account.

    Read our Mozo Review to learn more about the Simplicity PLUS Special Offer LVR <80%

*WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for the amount and term you entered.

**Initial monthly repayment figures are estimates only, based on the advertised rate, and a loan of $500,000 repaid over 25 years. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

How much could refinancing your home loan save you?

According to APRA figures published by Guardian Australia earlier this year, around 80% of all owner occupier home loans are controlled by either ANZ, Commonwealth Bank, NAB or Westpac.

And given that, according to the Mozo database, the average big four variable package rate for a $400,000 owner-occupier home loan, with an 80% LVR over 30 years is currently 4.58%, it makes sense that many homeowners could potentially save.

By comparison, the average variable rate in the Mozo database for the same loan scenario above is currently 4.35%, while Reduce Home Loans’ Rate Lovers Variable Home Loan, currently the lowest rate in the Mozo database, is even lower at 3.44% (3.51% comparison rate*).

But just how much could that rate difference translate to when it comes to your back pocket?

According to the Mozo home loan repayments calculator, a borrower with a $400,000 home loan making principal and interest repayments over 30 years would need to pay $2,046 a month on a loan with the average big bank packaged interest rate of 4.58%.

However, if they were to take up a home loan with the average rate in the Mozo database of 4.35%, that monthly repayment would fall to $1,991, and it would drop even further to $1,783 each month with the Reduce Home Loans rate of 3.44% (3.51% comparison rate*).  

RELATED: Crush your mortgage in 2019 with these top value home loans

Think now’s the time to finally think about refinancing your home loan? See what’s out there by checking out some of the hot home loan deals in the table above, or compare even more offers using Mozo’s handy refinance comparison tables

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