A mortgage broker has confirmed the trend that borrowers are willing to make a move to find a product better suited to their needs, reporting that more than 80% of the mortgage holders who refinanced through the group in the last year have switched lenders.
According to Aussie, just 18% opted to refinance with their existing lender.
“The historic low mortgage interest rates and strong competition amongst lenders are inspiring mortgage holders to review the state of their home loan to secure a good deal,” explained Aussie CEO James Symond.
“Close to half of the appointments across our national broker footprint are currently about refinancing, including what options and products are available to existing mortgage holders during these challenging economic conditions.”
ABS data revealed the total number and value of refinanced home loans peaked in May 2020, up to $15.1bn from the previous high of $12bn in April. It decreased slightly to June 2020, but remains 74% up year on year.
Within its organisation, Aussie has reported a further 9.8% rise in refinancing to the end of June 2020, compared with the same period last year. The group expects the refinancing trend to continue into the coming months, as its research shows 70% of mortgage holders feel now is a good time to refinance their home loan.
“Brokers can help home owners find a good rate and navigate them through what can be an overwhelming process without guidance,” said Symond, referring to Aussie research which revealed the presence of “widespread confusion” about what refinancing actually entails.
As such, many Australians report they're holding back from refinancing solely because they’re not sure where to start and are overwhelmed by the process at large.
“Two key benefits of using a mortgage broker are finding out what refinancing deals are available in the market such as cashback offers and an assessment of eligibility, as this is crucial amid an unusual economic time,” Symond concluded.