The RBA decision – why it’s making headlines
In a widely anticipated move, the Reserve Bank of Australia (RBA) has announced the cash rate will stay at 3.85% for July 2024. This fifth consecutive month of stability has gifted homeowners a bit of breathing room, particularly following a period of sharp interest rate hikes. However, it’s still important to understand that while the RBA’s decision may bring some relief, it doesn’t necessarily mean better rates for everyone.
Although the RBA has held rates steady this month, many homeowners across Brisbane could still be paying significantly more than they need to. Basically your bank isn’t likely to offer you a better rate unless you ask for it – this tends to be especially true if your home loan hasn’t been reviewed in the past six months.
What the RBA hold means for your home loan
Many borrowers, especially those with loans taken out over the past few years, are still sitting on higher rates from the rapid interest rises of 2022 and 2023. While the current RBA rate pause gives some comfort, lenders notoriously haven’t always passed on those savings to customers.
For instance, a large number of homeowners with variable loans are still paying rates well above 6% – even though the RBA cash rate has remained stable for some time now. It’s important to consider that your bank may not proactively offer you a better deal. As a result, you may be paying more than necessary, straining your budget, unless you directly ask for a better deal.
Signs your home loan needs reviewing
We’ve compiled a simple checklist to help you determine whether it’s time to review your mortgage:
- You haven’t checked your loan in the last six months or more – If you haven’t revisited your loan in half a year or more you may be missing out on better rates.
- Your lender hasn’t passed on improved rates – Banks rarely offer better rates unless you ask.
- You’re coming off a fixed-rate term – If your fixed-rate period is coming to a close your lender may automatically shift your loan to a higher variable rate. A quick review could ensure you get the best possible rate instead.
- You’re unclear on what rate you’re on – If you’re not quite sure what your interest rate even is, it’s a sure sign that your loan could use some attention.
- You’re feeling financially strained by your repayments – If your monthly repayments have been causing financial difficulty reviewing your loan could help to ease your concerns.
What a home loan review can do for your budget
It’s worth noting that reviewing your loan doesn’t necessarily mean you’ll need to refinance. In some cases, simply determining whether your current rate still stacks up is all it takes to make sure you’re not overpaying. However, if you do discover that your rate is outdated, refinancing can potentially save you hundreds of dollars each month. By comparing offers from different lenders, you might find a much better deal.
At Borro, we pride ourselves on being transparent and professional – working with you to get the best rate possible. We’ll make sure that lenders compete for your business, automatically giving you more options.
Brisbane case study snapshot
To further examine how a loan review can make a tangible difference, here’s a case study on the impact of simply checking if you’re getting the best possible deal.
A couple in Logan recently contacted Borro for a loan review. They were shocked to discover they were still paying a higher rate on their variable loan, despite the recent rate stability. After reviewing their loan with our help, we negotiated a new rate for them – without the hassle of switching banks – and reduced their monthly repayments by $380. It was a simple process and saved them significant money every month.
Regions we work closely with at Borro
We understand that the mortgage market varies from region to region, and as locals ourselves, we’ve developed deep expertise in the local trends across Brisbane and its suburbs:
- South Brisbane: We keep a keen eye on refinancing trends and help homeowners secure the best deals.
- Logan: Whether you’re a first-time buyer or looking to refinance, we know the mortgage landscape in Logan inside and out.
- North Brisbane: For families upgrading homes or first-time investors, we provide tailored advice that helps you make informed decisions.
- Inner-city Brisbane: For clients with growing property portfolios, we offer strategic insights to keep your mortgage on track.
At Borro, we understand that each region of Brisbane has unique lender activity and different rates at play. Local brokers such as ourselves are in the know and can help you to navigate these differences with ease.
Is it time to review your home loan?
It’s important to remember that a review doesn’t mean you have to switch lenders. But if it’s been over six months since you last looked at your mortgage, a quick check could reveal big savings that you’re missing out on. If you’ve been feeling the pinch from rising repayments or just want to ensure you’re getting the best deal on your home loan, Borro is here to help you with a simple, no-pressure review.
Contact us today for a quick loan check-up – it could be all it takes to cut your repayments without any hassle.
FAQ's
The RBA’s cash rate influences lenders but it’s up to your bank to pass on changes to borrowers – or not. You may still be paying a higher rate regardless, depending on your lender.
We recommend reviewing your home loan at least every six to twelve months to ensure you’re getting the best deal available.
Even if you’re on a fixed rate home loan it’s important to review your mortgage to ensure you don’t automatically roll into a higher rate at the end of the term.
It may be worth changing lenders – particularly if your current lender isn’t offering competitive rates. However, a simple review with Borro can help you to decide if switching or negotiating with your current lender is the best option.
A loan review typically takes just a few minutes, with the potential for more time if refinancing is needed. The process is fast, easy and pressure-free.
