03 Apr

Tips to Negotiate a Lower Home Loan Interest Rate

When you got a home loan, you might have bagged the best interest rate among the prevailing ones. We at Home Loan Comparison always recommend that prospective buyers first compare different loans, their terms and conditions etc. before making a final decision. 

But interest rates keep changing and you may be unaware about it. You may be paying more than the present rates call for and you want to know how to fix it. Being a highly competitive market, lenders in Australia are always eager to offer discounted rates to attract borrowers. But you need to take some effort and learn how to negotiate with them in order to get a lower homeloan interest rate. Some steps to follow include:

  1. You Need To Do Research

You need to research the local property market before you approach any lender. Be well armed with information on the interest rates various banks and lenders are offering. This would enable you to negotiate from a position of advantage as the lender knows that you are well informed. To help you with this research, check out current interest rates available on Home Loan Comparison.

  1. What Rate Are New Customers Being Charged?

It is good to know the rate new customers are paying. If they are paying less, the question you should pose to your lender is “Why are you charging me a higher rate than the new customers and what about new facilities for me?” You are the loyal customer and you must get a lower rate too without being subjected to any discrimination.  Your knowledge of the interest rates in the market will help you argue effectively with the lender and negotiate a better rate. Remember that even a 0.50% lower interest rate will save you a lot of money over the life of the loan.

  1. Switching Banks – Don’t Hesitate

It is common for bankers to think that existing customers are indifferent about their loan and may not give a thought to refinancing it. You have to put in some effort, but the whole exercise of refinancing can be worthwhile as it saves you a tidy amount in the future. As for banks, they would not like to lose your account if you have been a creditworthy borrower. They know well that retaining a present customer is better than searching a new one. They would be more than willing to consider you for a good offer.

One of the best ways to ensure that your lender isn’t short-changing you is to keep abreast of the latest financial trends and be aware of existing loans and interest rates. If you want to know more, don’t hesitate to contact Home Loan Comparison co.