Sarah: If you feel like your home loan repayments are never going to come to an end, the key
can be as simple as negotiating a lower rate.
It's worth regularly reviewing your rate to ensure you've got the best rate possible,
especially since the recent cash rate drops.
Sarah: Hi, guys, it's Sarah from Lendi, Australia's number one online home loan platform, where
we've already helped thousands of Australians refinance or get a better interest rate on
a home loan.
Watch this video for five key steps on how to negotiate a better interest rate with your
lender that could save thousands of dollars in interest over the life of the loan or reduce
your loan term.
Sarah: Now, before we start, if you want great home loan tips in Australia, please subscribe
to our channel, and don't forget to hit the bell to be notified when we upload new videos.
Sarah: Number one, ask for the same rate that new customers get.
Don't be afraid to contact your lender to ask for a better deal.
Speak with confidence and ensure that you ask for the same rate that they give new customers.
You may find that some lenders are willing to negotiate the rate to retain their customers,
provided you're in a strong position, with no missed payments.
Sarah: If you have a good credit history and you've been paying off your home loan over
the past 10 years, you could be in a really strong position to negotiate your interest
rate.
Negotiate you rate with your lender.
You may be surprised how quickly they're persuaded to lower your interest rate.
Sarah: Number two, do your research.
Before speaking to your lender, make sure you shop around to understand what other lenders
are offering for someone in your situation.
You can find out if there are better rates available in minutes by using a comparison
site, which will give you an understanding of the breadth of the market.
Sarah: Show your lender that you know that there are better rates out there.
This can be a great bargaining chip when it comes to reducing your rate.
Even so, you should shop around to see what other lenders can offer you.
Your lender may be unwilling to budge and you may decide to refinance to someone else.
Sarah: Number three, play the loyalty card.
As already mentioned, use your loyalty as a bargaining chip, if you must.
Many borrowers stay with the same lender for years, and if you have a good history with
them, it can really help to negotiating your rate.
Sarah: Prior to asking for a lower rate, make sure you review your position, check that
you've been making your repayments on time and that your LVR has gradually been reducing.
With this, you now have a current timeline and proof of your loyalty and being a good
customer.
This can be really helpful.
Sarah: Number four, make sure you're the ideal borrower.
Be the borrower the banks love to lend to and give yourself the best shot at nabbing
that lower rate.
Lenders look for a number of key things before calculating your interest rate.
Lenders want borrowers with a low LVR. LVRs above 80% can hinder your negotiations, a
good credit score, no missed repayments or defaults, and steady employment.
Sarah: Be aware of the factors that may hinder your negotiations, like the customer that
you are, for example if you're self employed, an investor, or a non-resident, missed paying
repayments or poor credit score, or if you owe over 80% of the property value.
Sarah: And number five, be prepared to walk.
When it comes to negotiating, you should always be prepared to walk.
If your lender is refusing to buckle and offer you a competitive rate, don't be put off by
the refinancing process.
Nowadays, the process of switching lenders is fairly simple and can be completed in as
little as a week in some cases.
Hence, if lowering your rate is important to you, be prepared to change lenders.
Sarah: For more information on how to refinance, check out our YouTube video here.
If you're looking at how to decrease your home loan repayments, check out lendi.com.au.
Our online home loan platform allows you to compare rates and apply online, all supported
by Home Loan Specialists that will be there for you every step of the way.
Sarah: That's it, guys, five steps to help you negotiate a better interest rate on your
home loan.
Now, if you're looking for more tips, you can join our Home Loan Hacks Australia Facebook
group, where we answer any questions that you have about all things home loans.
Sarah: Finally, if you found this video helpful, give us a thumbs up, and if you have any questions,
don't forget to leave them in the comments section below.
If you also want any more information on other relevant home loan topics, you can watch our
video here.
See you next time.