Mozo has announced the results of its annual Experts Choice Home Loan Awards this week, and found that nearly two-thirds of the Low Cost Award winners were online lenders.
The awards compared 504 home loans from 89 providers, and awarded the top 10% in each of the 8 categories. Categories included First Home Buyer, Offset Home Loan, Split Loan and two categories for Investors, and were chosen to reflect the different needs of home loan borrowers and which products best cater to them.
This year, Mozo found that online lenders took out more awards for great value mortgage products than in previous years, accounting for approximately 41% of the winners overall, up from just over 25% last year.
And it’s no wonder, when Mozo calculations showed that borrowers could save $3,184 each year, by switching from one of the big banks to an online lender.
Investors after variable rate loans and first home buyers were particularly spoiled for choice with online lenders, which increased their share of the awards by 40% and 30% respectively in each category.
Despite the great value on offer, a Mozo study found that borrowers were sometimes reluctant to take out a home loan with an online lender, mainly because they didn’t know enough about them.
“Many online lenders can offer borrowers serious value, thanks to lower overhead costs than traditional banks. But it can be a bit daunting for borrowers when they feel they simply don’t know enough about online lenders to put their trust in them,” explained Mozo Director Kirsty Lamont.
While Aussies were aware of the benefits of online lenders, just 27% said they’d be willing to take out a home loan online. 43% said they preferred to be able to discuss a mortgage face-to-face with an expert before committing.
“Consulting a specialist can be an important step in the home loan process, but when looking for the best possible value, it’s important that borrowers do their own research as well and consider all the options available to them,” said Lamont.
A good place to start searching for an excellent value home loan is with our Experts Choice Awards - we’ve done all the hard work for you! Find the full list of winners here.