We all want the best home loan deal but you may be amazed to know how often as advisers we find that people can do better.
Many people have a deal which looks okay, but unless you do a full review it is almost impossible to know how good your home loan deal is.
This is especially so if you are dealing directly with the bank (any bank) as the best they can offer you is what that particular bank thinks is a good deal.
As mortgage advisers or brokers we get asked this all the time.
The truth is there is no single bank that offers the best deals all of the time.
My name is Stuart Wills and as a mortgage broker with over 20-years experience I have seen a lot of changes. I have seen banks that will compete aggressively and offer the best deals for a while, then they change and are not competitive, but later are competitive again.
Things change and banks change – today you might find that TSB Bank or Westpac offer the lowest home loan rates, but next month it might be ANZ or BNZ.
As a mortgage broker I like to ensure that people get the best home loan deal most of the time.
Getting A Better Mortgage Deal
Sometimes it is obvious that someone is not getting the best home loan deal, and other times it’s not quite so obvious.
This week I have worked with three separate families to review their mortgages.
Refinance from non-bank lender to a bank – first up there was a couple with a non-bank mortgage with Resimac Home Loans. This couple has previously had some issues with the IRD and a default lodged with credit agency Veda and for that reason they had their home financed with Resimac Home Loans. But when I reviewed their loans and checked their credit reports they were now in a position to move back to a bank, so that is what we did. We did a mortgage refinance which saw their home loan interest rate from 7.20% to 4.49% which meant they would straight away start saving over $500 a month on their mortgage of about $250,000.
Getting better interest rates for low equity loans – another couple had purchased their home 12-months ago with a 10% deposit and when their bank offered them an interest rate it included the low equity margin (LEM) which saw them being offered a 2-year fixed rate of 5.44% (2-years rate of 5.19% + 0.25% LEM) which they felt was too high. As mortgage advisers we know that banks do charge low equity margins, but we also know that some banks have smaller low equity margins, plus some banks will apply the margin to the discounted rates rather than the standard rates. In this case we managed to get the existing bank to match a lower 2-year fixed rate (with LEM) of 5.05% and on their mortgage of just under $600,000 this saved them about $75 per month without any need to change banks.
Refixing a loan at the best rates – another couple had a loan coming up for refixing and while this loan was only for just over $100,000 we still managed to get an interest rate 0.20% lower than what the bank had offered. This alone would save them about $15 per month, but we also noted that they had a credit card debt which had been at just over $6,000 for the past few months so we included this into the loan and straight away that saved them another $70 each month.
These are three quite different examples of mortgage reviews that I worked on this week, and in every case there was a benefit for the people in working with an adviser.
In at least two of these cases they could never have achieved the same result had they dealt directly with their lender or bank.
They included a number of the banks and non-bank lenders including ANZ, ASB, Resimac Home Loans and Westpac.
Ask About The Best Home Loan Deals
As mortgage advisers we like to think that we can always get you the best home loan deal, and in most cases we can get a good deal that is suitable to your situation.
Best of all, we get paid by the banks so a review of your mortgages is free.
Sometimes we may recommend that you stay with your existing bank even if they are not offering a deal quite as good as another bank, whereas other times there are compelling reasons to change banks. Every situation is different but you can be assured that as advisers we work for you (not the banks) and strive to ensure that you do get the best home loan deal available.