With interest rates on the rise, savvy borrowers willing to look around for a better home loan deal could be saving thousands of dollars every year, as Brisbane homeowner Jessica Steele discovered when she refinanced her mortgage.
When Jessica and her husband Brett first signed up for a mortgage, they were with a big bank and paying interest at a rate of 5.05% p.a..
Sick of high monthly repayments, the couple decided it was time to refinance, and turned to an online home loan comparison to search out better deals. They struck gold with Heritage Bank.
“We found Heritage could offer us a much lower rate of 4.14%, which meant we would save around $7,000 in home loan repayments each year,” Jessica said*.
“We’ve saved heaps by shopping around and will put the money towards our upcoming renovation later in the year.”
Jessica’s advice for other borrowers? “It doesn’t cost you anything to shop around and ask questions. Don’t just settle for what you’ve got because there’s always a better deal out there.”
According to Mozo director Kirsty Lamont, refinancing is a great way to slash your mortgage repayments but borrowers will need to budget in switching costs like loan discharge fees and any upfront fees that may be charged by the new lender.
Kirsty also recommends refinancers look for flexibility as well as a great rate. For instance an offset account can help you reduce the amount of home loan interest you pay, while an extra repayments facility gives you the option of paying off your loan faster.
Ready to refinance your mortgage and start saving? Check out these top home loan options, handpicked by our Mozo money editors.