More home owners making the switch to save a bundle
Announcement posted by Wagga Mutual Credit Union 30 Nov 2012
Figures from the Australian Bureau of Statistics show the number of Australians switching their home loans to other financial institutions has increased by 16 per cent in the past financial year, meaning more home owners are looking for a better deal to save money on their mortgage.
For the month of September, leading financial institution Community CPS Australia, saw a year-on-year increase of 94.4 per cent of people bringing their home loans across from another lender. Its local subsidiary, Wagga Mutual saw home loan switching numbers locally that were inline with the group’s result during the first quarter of the financial year (July-September 2012).
Wagga Mutual Regional Manager Andrew Toole predicts the trend towards switching will continue, particularly following the Federal Government’s new legislation on switching financial institutions from 1 July 2012.
“The new legislation gives homeowners the ability to change financial institutions without having to go back and forth with their current provider. The new provider now arranges the switch, making it really simple to make the move,” Mr Toole said.
“We will see more and more people looking for alternative products as home loan packages become more competitive, which actually works in the consumers’ favour,” he said.
“People can save thousands by switching providers, for example, if they can find a home loan product that reduces their interest rate from 6.69 per cent to 6.49 per cent they could save up to $450 a year – based on a standard mortgage of $300,000. This would be a saving of more than $11,000 over the course of a 25 year loan.”
Mr Toole recommends the following to those who are considering a switch:
1. Assess – is your current home loan still the best solution for you? Has your lifestyle changed since you first took out the loan and what loan features are most important?
2. Research – see what other financial institutions – including credit unions and building societies – are offering and which package meets your needs
3. Understand your existing terms – find out whether you will have to pay any exit fees and if so, will this be worth it in the long term
4. Speak to the professionals – after doing your own research, it’s a good idea to talk to your existing and potential provider to get the best possible product
ABOUT THE COMMUNITY CPS AUSTRALIA GROUP
Two-time winner of Money magazine’s Credit Union of the Year award (2012, 2008) and winner of the Mozo People’s Choice Award for Best Credit Union (2012) the Community CPS Australia Group is one of the largest customer owned financial institutions in Australia, with assets under management approaching $4 billion. The credit union employs 598 staff across 48 branches, servicing more than 184,000 members. Community CPS is located in South Australia and the Australian Capital Territory, and operates as Wagga Mutual Credit Union in Wagga Wagga, Companion Credit Union in the Hunter Valley and United Community Credit Union in Western Australia. Community CPS was also named Money magazine’s Best Credit Union in 2005.
The Group comprises activities in banking, the community (through the Community CPS Foundation) and professional services (wealth management, tax and accounting services via Eastwoods). For more information visit www.communitycps.com.au
For the month of September, leading financial institution Community CPS Australia, saw a year-on-year increase of 94.4 per cent of people bringing their home loans across from another lender. Its local subsidiary, Wagga Mutual saw home loan switching numbers locally that were inline with the group’s result during the first quarter of the financial year (July-September 2012).
Wagga Mutual Regional Manager Andrew Toole predicts the trend towards switching will continue, particularly following the Federal Government’s new legislation on switching financial institutions from 1 July 2012.
“The new legislation gives homeowners the ability to change financial institutions without having to go back and forth with their current provider. The new provider now arranges the switch, making it really simple to make the move,” Mr Toole said.
“We will see more and more people looking for alternative products as home loan packages become more competitive, which actually works in the consumers’ favour,” he said.
“People can save thousands by switching providers, for example, if they can find a home loan product that reduces their interest rate from 6.69 per cent to 6.49 per cent they could save up to $450 a year – based on a standard mortgage of $300,000. This would be a saving of more than $11,000 over the course of a 25 year loan.”
Mr Toole recommends the following to those who are considering a switch:
1. Assess – is your current home loan still the best solution for you? Has your lifestyle changed since you first took out the loan and what loan features are most important?
2. Research – see what other financial institutions – including credit unions and building societies – are offering and which package meets your needs
3. Understand your existing terms – find out whether you will have to pay any exit fees and if so, will this be worth it in the long term
4. Speak to the professionals – after doing your own research, it’s a good idea to talk to your existing and potential provider to get the best possible product
ABOUT THE COMMUNITY CPS AUSTRALIA GROUP
Two-time winner of Money magazine’s Credit Union of the Year award (2012, 2008) and winner of the Mozo People’s Choice Award for Best Credit Union (2012) the Community CPS Australia Group is one of the largest customer owned financial institutions in Australia, with assets under management approaching $4 billion. The credit union employs 598 staff across 48 branches, servicing more than 184,000 members. Community CPS is located in South Australia and the Australian Capital Territory, and operates as Wagga Mutual Credit Union in Wagga Wagga, Companion Credit Union in the Hunter Valley and United Community Credit Union in Western Australia. Community CPS was also named Money magazine’s Best Credit Union in 2005.
The Group comprises activities in banking, the community (through the Community CPS Foundation) and professional services (wealth management, tax and accounting services via Eastwoods). For more information visit www.communitycps.com.au