New lender Nano aims to put ‘outdated’ home loan process to shame with digital spin

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As the hundreds of thousands of Australians who take out a new home loan or refinance every year will attest to, applying for a loan and getting it approved can often be painful.

New research from digital lender Nano backs that sentiment up, with three in four Australian homeowners admitting frustration with the ‘slow’ and tedious’ mortgage process.

Nano, which is one of the newest lenders in the country having launched last month, is on a mission to call out the deficiencies in the ‘outdated’ home loan process though. To start, the fintech has launched its own Inaction Figure - a manifestation of the parts of the process that homeowners dislike the most.

According to Nano’s research, confusing jargon (72%), the slow process and hidden fees (55%) and excessive paperwork (48%) were among the major annoyances.

“If you’ve ever had a home loan you’re probably familiar with The Inaction Figure and what he represents. Lenders are stuck in the past, drowning in paperwork, legacy technology and processes,” says Nano co-founder and chief executive, Andrew Walker.

“There hasn’t been any innovation in decades which means the industry is sitting on old technology, old products, old processes and ultimately that means the customer is still doing the heavy lifting.”

“You’re not going to ask anyone on the street what they think the current mortgage process is like and then get a double thumbs up in return.”

The world’s fastest home loan?

In the past few months the volume of new home loans being taken out by Australian buyers has surged, with $32.6 billion worth of new lending recorded by the ABS in May alone - the highest amount on record. 

While this has been a boon for lenders, the sheer number of loan requests flowing in has also put pressure on application and approval processes. As a result there have been plenty of reports of slower processing times. 

So just how long does the process tend to take? According to Nano’s research, one in two Australians said their home loan approval took up to four weeks, while a further one in five said it took up to two months. 

Enter Nano. While the fintech is not the first Australian lender to take on long mortgage applications and approvals, its fully digital process aims to reduce these times significantly.

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Image: The Nano 'Inaction Figure' (courtesy of Nano)

“We’ve designed a seamless home loan application and approval process. We know, for example, that globally it's a first - it’s the fastest mortgage approval process in the world, which we’re quite proud of,” says Walker

“So far, the fastest loan application to unconditional approval - so the end of the application, the credit assessment and the ID process - has been 9 minutes and 41 seconds.”

Walker says that the speed and ease of the process ends up being advantageous for both Nano and its mortgage applicants. 

“It benefits us because the shorter the process and the more automation you have, the lower the operating costs, which allows us to offer sharper rates to our customers. We also don’t expect the customers to do the heavy lifting - we think that it should be a process that isn’t lengthy, opaque and confusing or one in which they have to do all the work.”  

Tackling refinancing inertia  

As part of its final home loan price inquiry report released in December 2020, the ACCC urged Australian mortgage holders with older home loans to reassess their rates given the significant amount of money they could save by doing so. 

Despite this call out and even with home loan rates currently at some of their lowest levels ever, only a small percentage of homeowners regularly switch their mortgages. A recent Mozo number crunch found that roughly 470,000 mortgages had been refinanced in the 12 months to March 2021, which equates to about 8% of the total mortgages in Australia.^^

What’s behind this ‘home loan inertia’ though? 

Walker believes it comes down to three main areas: the knowledge customers have about their existing rate and fees compared to other offers, the monetary benefit they’ll receive by switching and the effort they’ll face in actually making the move. 

“We think we’ve solved all of those things,” he says. “We’re fully transparent, our savings are significant enough for people to see the benefit of switching and, thanks to our application and approval process which can take as little as 10-20 minutes, the amount of effort people need to make is kept to a minimum.”

With variable interest rates from 1.99% (1.99% comparison rate*) for owner occupiers and 2.29% (2.29% comparison rate*) for investors, Nano’s Variable Home Loan rates are among the lowest in the Mozo database at the 75% loan-to-value ratio (LVR) tier. 

The owner occupier rate is also a considerable 121 basis points lower than the average variable rate in the Mozo database of 3.20% for owner occupier loans with a maximum LVR of 75%. 

To put that difference into perspective, an owner occupier who was able to refinance their existing home loan balance of $400,000 from a rate 3.20% to 1.99% would reduce their monthly repayments by $237 and save $56,883 in total interest over a 20-year period. 

Currently Nano home loans are only open to owner occupier and investor refinancers though, but Walker says that the will be available for new purchases later in the year. 

RELATED: Have an energy efficient home? Loans.com.au has a discounted home loan rate

To find out more about Nano’s mortgage offer, including all the features and rates involved, read our Variable Home Loan review.

Otherwise see how it stacks up against some of the great offers for refinancers in the table below, or head on over to the Mozo refinance home loan comparison hub to compare even more deals from a larger range of lenders. 

^^Refinancing figures sourced from ABS Lending Indicators January 2021 and mortgage numbers sourced from APRA’s February 2021 loan deferrals report .

Mozo may receive payment if you click products on our site. We don’t compare the entire market, but you can compare more home loans here.
Last updated 30 October 2024 Important disclosures and comparison rate warning*

Refinance home loan comparisons on Mozo

  • Fixed Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    5.93 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Competitive fixed rate on up to a 30 year loan term. No application fees to pay. Additional repayments up to $20,000 per year without penalty. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Fixed Express Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).

  • Fixed Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    5.93 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Competitive fixed rate on up to a 30 year loan term. No application fees to pay. Additional repayments up to $20,000 per year without penalty. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • Fixed Express Home Loan

    • Owner Occupier
    • Principal & Interest
    Interest rate
    5.54 % p.a.
    Fixed 2 years
    Comparison rate
    6.11 % p.a.
    Initial monthly repayment
    $2,852
    Go to site

    Lock in a low 2 year fixed rate with the Mozo award winning Home Lender of the Year. Available for live-in borrowers with just a 10% deposit required. Free extra repayments (up to 20% in fixed period), free redraw and partial offset available. $10 monthly service fee. Aussie support centre. Fast approvals. Up to 6 free offset accounts (T&Cs apply).

  • Fixed Rate Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    5.59 % p.a.
    Fixed 5 years
    Comparison rate
    6.27 % p.a.
    Initial monthly repayment
    $2,867

    Get repayment certainty with HSBC’s low 2 Year Fixed Rate Home Loan. Make up to $10,000 of extra repayments a year. The option to split your home loan between fixed and variable. Plus, score $3,288 cashback when you refinance an existing home loan of $250,000. Must apply by 28 February 2023 and settle by 30 April 2023.

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    5.74 % p.a.
    Fixed 3 years
    Comparison rate
    6.81 % p.a.
    Initial monthly repayment
    $2,915

    Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.

  • Variable Home Loan

    • Owner Occupier
    • Principal and Interest
    Interest rate
    5.98 % p.a.
    Variable
    Comparison rate
    6.02 % p.a.
    Initial monthly repayment
    $2,991
    Go to site

    Competitive variable rate on up to a 30 year loan term. No application fees to pay. Unlimited additional repayments. Free online redraw. Optional 100% offset feature ($10/month) 10% minimum deposit. Fees & charges apply, Australian Credit Licence 237879 is held by Bendigo and Adelaide Bank Limited, the credit provider.

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Discounted Home Value Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <60%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.99 % p.a.
    Initial monthly repayment
    $2,995

    Enjoy competitive rates for owner occupiers. Enjoy unlimited free extra repayments. Flexibility to redraw additional payments for free. No ongoing monthly service fee. Receive $3,288 cashback when you refinance an existing home loan. Minimum loan amount of $250,000, settle within 120 days from applying.

  • Express Home Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <90%
    Interest rate
    6.09 % p.a.
    Variable
    Comparison rate
    6.22 % p.a.
    Initial monthly repayment
    $3,027
    Go to site

    Get online approval from the award-winning Bendigo Bank Express Home Loan. Multiple offset accounts and redraw available. 100% offset on variable rate loans and partial offset on fixed rate. Flexible repayment options. New home loans only.

  • Mortgage Simplifier

    • LVR<80%
    • Owner Occupier
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.17 % p.a.
    Initial monthly repayment
    $3,043

    Get a competitive variable rate with ING’s Mortgage Simplifier. Free extra repayments, no monthly or annual fees. Freedom to make free extra repayments or redraws.

  • Elevate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.18 % p.a.
    Variable
    Comparison rate
    6.18 % p.a.
    Initial monthly repayment
    $3,056

    Get competitive rates on loan terms of 5 to 30 years with the Aussie Elevate Home Loan. Structure your loan with up to five splits. Make additional repayments (T&Cs apply). Offset accounts available. Unlimited redraw using your online banking account. Choose from weekly, fortnightly or monthly payments For loan amounts from $10,000 to $5 million.

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Need help with your Home Loan?

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* 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 $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. 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.

^See information about the Mozo Experts Choice Home Loan Awards

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