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Switching lenders has never been more popular

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Switching lenders has never been more popular

Refinancing has reached record levels, according to new data from the Australian Bureau of Statistics.

A record 33,712 Australians refinanced in May, the most recent month for which there are stats. That was up 30% on April, which was itself a record.

Of those who refinanced, 64% moved to another lender, while 36% stayed with their current provider.

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There are two reasons why refinancing is so popular:

  1. Interest rates are at record-low levels
  2. Lenders are competing hard for business, with cashback offers and other deals

While refinancing is a good decision for many borrowers, it won’t suit everyone. Here are some questions to ask:

  1. Will you have to pay money to close your current loan early?
  2. Will you be forced to pay LMI (lender’s mortgage insurance) if you switch?
  3. Will your new loan revert to a higher interest rate after a honeymoon period?
Want to refinance?

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