Many home owners are saving an average of 0.71 per cent on their home loan interest rates or over $86,000 on a 30-year loan when they refinance, new data from Aussie Home Loans reveals*.
Aussie has also experienced a 16 per cent jump in demand for home loan refinance compared to just a couple of years ago, with these savvy savers now making up 35 per cent of the mortgage broker’s total settlements.
Aussie Founder and Executive Chairman, Mr John Symond, said the increase in home owners refinancing their loans reflects the fact that interest rates, market uncertainty and mortgages are now top of mind for the average Australian.
He said “There is a great deal of attention now being paid to the future of interest rates, the property market and ongoing uncertainty over the economy. Even though rates have largely been coming down through RBA cuts and hot competition, borrowers are still seeking to refinance their loans.
“Our figures show that more and more of our customers are taking advantage of record low interest rates. They are actively seeking out and securing themselves a better deal, saving tens of thousands of dollars in many circumstances,” added Mr Symond.
Based on Aussie’s average refinance loan size of $525,331, the average 0.71 per cent rate saving equates to $86,733.25 over the life of a 30 year loan*.
Refinancers in NSW are making the most of refinance savings with an average 0.75 per cent reduction, followed closely by Queenslanders saving an average 0.73 per cent on their home loan interest rate.
Owner occupiers are driving this growth in refinancing, up 23 per cent of total settlements compared to a couple of years ago. On the other hand, the number of investors refinancing has fallen by 5 per cent over the same period, or by 16 per cent since just last financial year.
“There has been a significant level of policy and pricing change across the mortgage market, particularly around loan serviceability and investment lending, with a major factor being the lower loan to valuation ratios (LVR) now required by lenders, and I believe this is slowing investor refinance activity.
“The steam has also gone out of the first home buyer market as prices in many areas of the major capital cities are still very high and simply unattainable for them,” added Mr Symond.
Aussie has more than 1,000 mortgage brokers across the country ready to help customers get a free, expert second opinion on their home loan. To book an obligation free appointment call 13 13 33 or visit www.aussie.com.au.