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A Sydney-based broker believes refinancing will be a key theme in 2017 as consumers are “more educated” about their options on the mortgage market than ever before.
Will Foster of Foster Finance told the Elite Broker podcast that “there was a lot more refinance” in 2016 than in previous years as consumers became better educated about alternatives on the market and were no longer “happy with what their incumbent bank[s were] doing”.
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He added that based on his experience he believed this trend would continue throughout 2017, and that refinancing wouldn’t strictly apply to consumers alone.
Lenders to reprice products
Mr Foster also noted that depending on the age of a broker’s books, natural refinancing for clientele was normal as “the bank 10 years ago isn’t the right bank now”.
In order for financial institutions to remain competitive for those educated consumers, he said he believed people could see lenders repricing their products in order to retain existing customers and draw new business in.
“I think they’ll be pricing [products] differently to try and retain that market share, but still pick up the profit on the back book,” he said.
“Even some of the larger banks that aren’t majors, like Macquarie – they’re really, really competitive.”
Mr Foster concluded by saying he believed many of the major banks would go as far as repricing their secondary brands, “whether it be Bankwest, St.George or NAB… or Macquarie through their white label products”.
“I think that’s going to be a really big part of this year,” he said.
[Related: ASIC should make it ‘compulsory’ to visit a mortgage broker]
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