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By: Jessica Darnbrough
The decision by some of the majors to lift their rates out of step with the RBA is forcing borrowers to shop around for their home loan.
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According to a new survey by online mortgage broker eChoice, 37 per cent of first home buyers said they intended to explore lenders for the best deal and 18 per cent would use a non-bank lender or mortgage broker.
Of the 1,000 respondents, among existing homeowners, only 20 per cent said they would refinance a new purchase with their existing big four lender, while 25 per cent intends to shop around for a better rate using a mortgage broker or other means.
Firstfolio executive director and eChoice spokesperson, Mark Flack, said rising rates made it more likely home buyers would look to second-tier banks or non-bank lenders to get the best possible mortgage deal, ditching their existing major bank if necessary.
“The charmed run the banking majors have enjoyed over the past 18 months, when the global downturn effectively closed out non-bank lenders and regional banks, may be coming to an end. The big four should not expect default new business from their current customers or existing borrowers as they finance a new property purchase,” Mr Flack said.
“In this environment mortgage brokers will have a bigger role in helping borrowers source the cheapest loan. Certainly the volume of inquiries coming through our platform, suggest this is the case.”
