It’s probably no surprise to you that an increasing number of people are choosing small, local funding instead of big banks. You could be one of these people… but if not, and you’re curious about why so many people are jumping away from the big four, here’s why smaller banks and mortgage lenders are stealing market share.
These smaller lenders don’t have the huge overheads that the big banks do, so they can provide stiff competition, incentives and discounted rates. Home owners are beginning to shop around and realising that jumping ship could save them a load of money — in fact, people choosing a major bank as their lender have decreased by 0.52% compared with 2012.
According to financial comparison website RateCity, one in six borrowers are choosing smaller lenders in preference to one of the big four banks.
RateCity CEO Alex Parsons says: “People are getting smarter with their home loans and realising that paying the higher rates is a waste of their money. As cost of living pressures bite, making a few tweaks to your home loan or refinancing into a lower rate can save upwards of $1000 a year on a typical $300,000 mortgage — where else can you find savings like that in your budget?”
What’s right for you?
In our next post we’re going to be looking at the differences between big and small lenders. It’s essential reading for anyone wondering if they could be getting a better deal anywhere else…
PS: If you’d like to talk to someone about your personal situation and find out whether you could be getting a better deal in your mortgage or other financial decisions, give us a call… we’d love to help!