Mortgage – until death. Sometimes it feels like it will take that long to pay it off. Here is a couple easy steps that could help you get a better home loan rate now and save you thousands.
A couple months ago I was looking at the interest rate on my home loan. It seemed a little high compared to current advertised rates. I like to use infochoice.com.au to compare savings and loan rates.
To my surprise I found that my own bank had an advertised interest rate significantly lower than my current rate. I checked my banks website to confirm and found the exact same product was offered for 60 basis points (0.6%pa) less.
I called up my bank and spoke to a representative and mentioned my findings. She responded ‘The rates are different because its for new loans not existing loans’. Oh that makes sense I guess. Why reward long term existing customers? I was about to say goodbye and the rep said ‘I can put Anthony Fasano Authentic Jersey you through to out rate negotiation department if you like’. A little stunned that they have a department for that I replied ‘sure’.
I had no idea you could actually negotiate interest rates. Sure enough after a bit of haggling and the ole ‘I will have to speak to my manager’ I ended up getting the advertised discount rate applied to my loan. Win!!
I was notified that there is a small fee involved to make the change. The reduction in interest charges would cover the fee within a few months. I agreed to go ahead.
I hope this little experience of mine will help others to negotiate a better home loan rate. You will have to do your own research to determine if the associated fees are worth the interest rate reduction. Who knows It may even work even other types of loans too!
Good Luck, let me know if you have had a similar experience yourself or have tried this and saved some money.