Finance
Save thousands on your home loan in 3 steps or less
With so much going on in the world right now, there’s a lot of information to absorb and get your head around. Everyday life seems to change every day.
Luckily, how to save money on your mortgage is relatively straightforward and hasn’t really changed. And as always, you can do it all online or over the phone.
Here’s our simple guide to getting a better outcome on your home loan and putting more cash back in your household budget.
1. Research the market online
The best starting point is research. Find out if you are paying a loyalty tax by comparing your interest rate to what your lender is offering new customers with a similar loan size and loan to value ratio (LVR). Then, compare these two rates against what other lenders are offering new customers with similar needs and loan features.
See how your interest rate stacks up
Enter a few details about your loan & see how much you could save
2. Negotiate with your lender
Take this research to your current lender and ask them to match the most competitive offer you’ve seen on the market or at the very least, what they are offering new customers who have a similar profile to you.
3. Refinance to a lower rate
Getting a lower interest rate doesn’t always mean changing lenders but if your bank doesn’t want to reduce your rate or your fees and your repayment history is solid and your LVR is below 80%, switch to another lender. It doesn’t take long, can all be done online and will save you thousands over the life of your loan.
How much can you save by refinancing?
Find out what your new repayments might be in seconds.
At Lendi, we are all about making things easy and finding ways to help you protect your finances. You can complete these three steps on the Lendi platform, with the help of one of our remote Home Loan Specialists or independently, it’s up to you. But the sooner you do, the sooner you can start saving.
See how much a 1% rate reduction can save you
| Loan size | Monthly savings | Annual Savings** |
|---|---|---|
| $800,000 | $401 | $4,812 |
| $600,000 | $301 | $3,612 |
| $400,000 | $200 | $2,400 |
**repayment rate based on a P&I loan over a 20-year term decreasing from 3.5% | 3.5% to 2.5% | 2.5%.
If your situation is more complicated and you’re considering taking a repayment holiday, chat to one of our experts. If time allows, you may want to make sure you are on the lowest interest rate possible before making changes to your repayments.
- Related: Mortgage brokers vs. banks - Which is best?
- Related: How to find the best home loan rate in 2020
Got a home loan question?
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The information in this post is general in nature and should not be considered personal or financial advice. You should always seek professional advice or assistance before making any financial decisions.
See how your interest rate stacks up
Enter a few details about your loan & see how much you could save
Tags: rba cash rate, reserve bank, interest rate, refinance, new purchase
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Home loan repayment saver tool
Enter a few details about your home loan and see how much you could save on your repayments