Homeowners could save thousands switching- here's how
Homeowners could save close to $4500 a year off their mortgages by shopping for a better loan deal now, new analysis found.
Comparison site Finder insights manager Graham Cooke urged more Aussies to look into how to boost savings across multiple cost centres.
"At a time when many households are feeling the financial pinch of COVID-19, we urge Aussies to see how their current loan stacks up," he said.
"If you're paying a higher interest rate or steeper fees, it could be time to switch and save."
He said there had never been a more important time to get a savings boost than now.
"For an owner-occupier loan (variable), Aussies could save $4,494 per year or $134,835 over 30 years by switching to the best product on the market."
The comments came after the comparison firm's 2020 awards named Freedom Lend its home loan category winner. Freedom Lend took out three categories in the Finder Awards including best owner occupier home loan - variable, best refinance home loan, and best investor home loan.
Finder's award for best owner occupier home loan - three year fixed was a product by Well Home Loans, while best investor home loan principal and interest three year fixed was awarded to Tic: Toc and best low deposit home loan (owner-occupier variable) was by P & N Bank & Home Loan.
According to Finder calculations, based on a loan size of $440,000, assuming 80 per cent LVR (based on Brisbane's median house price of $550,000), the annual saving to be had switching to the best owner occupier variable home loan was $4,494 or $134,835 over 30 years.
Finder said it arrived at the figures by reviewing the winner's interest rate in the final quarter of the Finder Awards assessment period (12 months to May 2020) versus the current standard rates quoted by the big four banks.
The winning three year fixed best owner occupier home loan saw calculated savings of $506 annually or $15,188 over three decades using that Brisbane data.
The best variable investor (P & I) home loan savings were estimated at $4,124pa or $123,705/30years while that of the three year fixed for the investor category was $431pa or $12,942/30years.
Mr Cooke said homeowners could also use apps to identify mortgage savings opportunities.
"Once you connect your accounts to the (Finder) app, it analyses your spending behaviour, hunts down savings and sends you alerts when it could make financial sense for you to refinance."
Originally published as Homeowners could save thousands switching to better mortgages now