More than half of all home loan holders fear they will never be able to pay off their home loan, according to new research.
The research comes as the bank launches Everyday Round Up for Home Loans, a digital tool that enables ING customers to round up the loose change from their card purchases to pay down their ING mortgage.
The figures by ING also show that 40% of borrowers are concerned they will carry their mortgage into retirement.
The research also suggests that borrowers are so eager to stay a step ahead of their mortgage repayments that 82% are paying down more than what’s required most years and 45% expect to pay off their mortgage at least five years prematurely.
With the new product, card purchases made through ING’s Orange Everyday account are rounded up to the nearest $1 or $5. The difference between the cost of the purchase and the rounded amount is then automatically shifted from the customer’s Orange Everyday account to pay down the mortgage.
Other budgeting apps, such as Raiz, have similar principles to help people invest and save, but ING’s new product is specifically to help paying off the home loan.
ING’s head of retail banking, Melanie Evans said, “Everyday Round Up for Home Loans is about helping our customers to stay a step ahead by enabling them to use their small change to pay off their biggest purchase – their home.
“We launched Everyday Round Up a year ago to help Aussies round up their loose change into a savings account where it would earn interest. In less than a year we’ve helped over 160,000 customers collectively save $32 million.”
ING estimates that customers who round up $50 each month to their 30 year owner occupier Mortgage Simplifier mortgage of $350,000 could shave 19 months or save $14,000 in interest by rounding up their loose change. This assumes the customer puts down a 20% deposit and makes principal and interest repayments.