Home Loan Interest Rate Creeping Up

For the last two years my home loan interest rate has been slowly creeping up. It started off around 3.89% and is now at 4.07% with one of the Big 4 banks. This has prompted me to look into other lenders to see what is on offer.

House Value: $450,000

Current Mortgage Balance: $284,000

4.07% Variable Principle and Interest 

$395 annual package fee

2 years into a 30 year loan. (planning on paying off loan over next 5/6 years with extra payments)

After contacting my current lender they have agreed to drop interest rate down from 4.07% to 3.92%

1 Email = Savings of $426 per year! not bad for 2 minutes of work.

I also search for best deal online.homeloaninterst

Best rate: 3.59% Variable P/I no offset but redraw. $0 annual fees

If I switch to this online lender, I would be saving $937 per year in interest + $395 annual fee = $1,332 per year!

There are a few fees in switching lenders to consider, discharge fee for my current loan $300, property title fee $179 and potential settlement fee $150.

I would also need to switch my everyday bank account over to avoid monthly fees to a fee-free online account. This would also involve contacting all direct debits to switch over.

If I switched over I wouldn’t have a offset account, this shouldn’t be a issue as I plan to pay the loan off early and never want to create a Investment Property out of it.

Should I do the paper work and make the switch?

What your current interest rate?

 

 

 

 

 

 

3 thoughts on “Home Loan Interest Rate Creeping Up

  1. Char

    Nice work that’s a pretty good rate we have only managed to get our big 4 bank down to 4.01% although that’s both our house and our rental so not to bad.
    For me personally it wouldn’t be worth the paper work to change as yet. I also keep my 3 month emergency money in my offset so there is that to consider also.

    Like

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