Thanks to the good folk at Australia’s most visited comparison site finder.com.au – new research has shown that more Australians than ever refinanced their home loan in May.
Finder analysis of the latest ABS lending data (released 9 July) revealed that both the total number and value of refinanced home loans peaked in May 2020.
The total value of these refinanced home loans exceeded $15.1 billion in May, up 26% from the previous high of $12 billion in April.
- ABS data reveals 33,712 Aussies refinanced in May, up 30% from April
- 64% of all refinanced loans were switching lenders, an all-time high
Clear reasons to look at the benefits of refinancing:
- My interest rate is too high. This is the most straightforward case. If your interest rate is high, then switching to a better deal will save you a lot of money. Dropping your rate on a loan of $350,000 from 3.45% to 2.59% would save you $162 a month or $1,944 a year.
- I want an offset account. Offset accounts are one of the most useful features on a mortgage. They allow you to save and spend money like an ordinary transaction account, but every dollar that sits in the account offsets your loan principal.
- I want to access some extra cash. A lot of people refinance a home loan so that they can borrow a bit more money. They can use the money for investments, to fund a home renovation or to buy a car. With rates being so low, refinancing to a cheaper rate and borrowing a little more can be quite cost-effective. It will probably cost you less than taking out a separate car loan.
- I’m struggling with mortgage repayments. It’s tough to refinance if you’re in financial distress. This is because you need to apply for a new home loan with a new lender. The lender will examine your finances and spending. If you’re in this situation, you’re better off focusing on getting your debt, income and expenditure under control.
Property Club have some members getting rates below 2.1% fixed for 2 years!
Examples below are based on $500,000 loan over 25 years:
Would you like your loan to start with a 2 in front of it?
Hit firstname.lastname@example.org for more information on this and start saving straight away!
Property Club is at the forefront of the best properties in the best areas – make contact with your Property Mentor or hit email@example.com for further information on the great options available for Club members!