Welcome to ask if you're in Greed, where we answer questions about business, investing, economics, politics, and more. I'm Sean Aylmer and hello. Michael Thompson, Hello, Sean.

Welcome to ask if you're in Greed, where we answer questions about business, investing, economics, politics, and more. I'm Sean Aylmer and hello. Michael Thompson, Hello, Sean.

Strange things are happening here.

Strange things are happening here.

It is. It's the other way around Normally, Michael asked the question and I give the answer. But Michael with the wonderful Kenneth Campbell on their podcast how do they afford that? There? He's responding because that podcast itself often talks about this exact question, So I think he's much better place than I am to provide a response. The question is given the cut and interest rates yesterday, how do we get a better mortgage rate? What's the process? Oh?

It is. It's the other way around Normally, Michael asked the question and I give the answer. But Michael with the wonderful Kenneth Campbell on their podcast how do they afford that? There? He's responding because that podcast itself often talks about this exact question, So I think he's much better place than I am to provide a response. The question is given the cut and interest rates yesterday, how do we get a better mortgage rate? What's the process? Oh?

Great question, Thank you Sean. And yes, look Canna Campbell would definitely be the better person to answer this, But without cannor in the studio, I guess it's fallen to me because we actually we did talk about this recently on how do they afford that? Because there is a process that you can go through, and sure it would be good if you were just automatically receiving that new lower rate and that you're at kind of the lowest possible rate for any kind of given bank, but in many cases customers are paying essentially a loyalty tax that if you have been with your bank for a long time, that even if your interest rate does come down, you are still going to be paying higher than perhaps new customers that are coming into the bank in the first place. And so really, and that's because people are not staying on top of it, that you're not checking in every kind of six months to see what new customers are paying and potentially whether you can get a better deal. So there are a few steps that we talk about as to what you would do in this scenario, and it starts with research, which sounds incredibly dull to me, well to me at least, maybe I'm a little bit biased on this, or maybe that's why I pay the loyalty tax because got this allergic reaction to that kind of research. But it is about you start with your interest rate. Check to see what you are actually paying. Because if you went out onto the street and ask ten people, I reckon about eight out of ten wouldn't actually know exactly what interest rate they are paying. Yeah, And so once you know that, then there are a few other things that you can do. You can go to the website for your bank and see what they are offering to new customers, and so you just check with check the new customer rate. Then go to the rivals. Go to the other whether it's big four banks or non bank lenders. Go to a comparison website like MOSO or Finder. There's a bunch of them out there, and go in there and you can just and it is very very easy to see what the other rates are. And you're just taking notes, write down all of these things as you're going check the fine print on those. So if you're seeing a fantastically low rate for another place, check it. It could well be an introductory rate that's only got a very short honeymoon period where it's kind of three months or six months, in which case, okay. The other things you need to put together before you make your call to your bank. How long you've been with your bank, So if you've been there ten years, fifteen years, twenty years, whatever it is, because that kind of thing matters, if you've been a long standing customer, how much you've actually paid off your home loan as well, any black marks against your name, so that you're aware of them and you can prepare to counter those whether you've missed repayments where they've had to chase you up because you've been late on previous occasions, and if you haven't, make sure you mentioned that as well. And also importantly to have the valuation of your house there, of property, whatever it is, and there's a website that kind of talks about a lot on the house dot com dot au where you can just go and it will give you an up to date valuation of your property. All of these bits and pieces. You take all of those in, then you call up your lender and you work through those things one after the other. You establish how long you've been there, what you're paying, how much you've paid off, how much you own in the property, what it's worth now. Why you deserve a rate cut and you don't settle is the other piece of advice is that when they will likely offer you are reduction in your rate, particularly if you're able to point to competitors who are offering a better rate, or just even that they are offering new customers at the same bank a lower rate. But don't settle. Take a day, take a couple of days to think about it and potentially shop around, and then go to and if all of that's too hard. If it is, if you're one of those people that doesn't like these kind of conversations, go to all mortgage broker yep, who are able to help you with this kind of thing. And in the end, chances are just by making that call you can save yourself a whole lot of money.

Great question, Thank you Sean. And yes, look Canna Campbell would definitely be the better person to answer this, But without cannor in the studio, I guess it's fallen to me because we actually we did talk about this recently on how do they afford that? Because there is a process that you can go through, and sure it would be good if you were just automatically receiving that new lower rate and that you're at kind of the lowest possible rate for any kind of given bank, but in many cases customers are paying essentially a loyalty tax that if you have been with your bank for a long time, that even if your interest rate does come down, you are still going to be paying higher than perhaps new customers that are coming into the bank in the first place. And so really, and that's because people are not staying on top of it, that you're not checking in every kind of six months to see what new customers are paying and potentially whether you can get a better deal. So there are a few steps that we talk about as to what you would do in this scenario, and it starts with research, which sounds incredibly dull to me, well to me at least, maybe I'm a little bit biased on this, or maybe that's why I pay the loyalty tax because got this allergic reaction to that kind of research. But it is about you start with your interest rate. Check to see what you are actually paying. Because if you went out onto the street and ask ten people, I reckon about eight out of ten wouldn't actually know exactly what interest rate they are paying. Yeah, And so once you know that, then there are a few other things that you can do. You can go to the website for your bank and see what they are offering to new customers, and so you just check with check the new customer rate. Then go to the rivals. Go to the other whether it's big four banks or non bank lenders. Go to a comparison website like MOSO or Finder. There's a bunch of them out there, and go in there and you can just and it is very very easy to see what the other rates are. And you're just taking notes, write down all of these things as you're going check the fine print on those. So if you're seeing a fantastically low rate for another place, check it. It could well be an introductory rate that's only got a very short honeymoon period where it's kind of three months or six months, in which case, okay. The other things you need to put together before you make your call to your bank. How long you've been with your bank, So if you've been there ten years, fifteen years, twenty years, whatever it is, because that kind of thing matters, if you've been a long standing customer, how much you've actually paid off your home loan as well, any black marks against your name, so that you're aware of them and you can prepare to counter those whether you've missed repayments where they've had to chase you up because you've been late on previous occasions, and if you haven't, make sure you mentioned that as well. And also importantly to have the valuation of your house there, of property, whatever it is, and there's a website that kind of talks about a lot on the house dot com dot au where you can just go and it will give you an up to date valuation of your property. All of these bits and pieces. You take all of those in, then you call up your lender and you work through those things one after the other. You establish how long you've been there, what you're paying, how much you've paid off, how much you own in the property, what it's worth now. Why you deserve a rate cut and you don't settle is the other piece of advice is that when they will likely offer you are reduction in your rate, particularly if you're able to point to competitors who are offering a better rate, or just even that they are offering new customers at the same bank a lower rate. But don't settle. Take a day, take a couple of days to think about it and potentially shop around, and then go to and if all of that's too hard. If it is, if you're one of those people that doesn't like these kind of conversations, go to all mortgage broker yep, who are able to help you with this kind of thing. And in the end, chances are just by making that call you can save yourself a whole lot of money.

Yeah, my two cents worth on this. And this is a personal view. Is I mean I have a fixed rate, I go fifty to fifty fixed floating Yeah, fixed part comes off in about six weeks, So I need to do all that and then go to my banker and say, hey, what can you do here? Because when my fixed rate comes off and basically double my floating rate mortgage and it's really important to have all that information at hand to get the best deal. Yeah.

Yeah, my two cents worth on this. And this is a personal view. Is I mean I have a fixed rate, I go fifty to fifty fixed floating Yeah, fixed part comes off in about six weeks, So I need to do all that and then go to my banker and say, hey, what can you do here? Because when my fixed rate comes off and basically double my floating rate mortgage and it's really important to have all that information at hand to get the best deal. Yeah.

And the thing is that you end up paying this loyalty tax because you are happy just to sit there and just let it all work through the system on its own. And unfortunately you are not guaranteed to get the best rate unless you actually ask for it.

And the thing is that you end up paying this loyalty tax because you are happy just to sit there and just let it all work through the system on its own. And unfortunately you are not guaranteed to get the best rate unless you actually ask for it.

What a great answer, Michael, I think my job has become redundant. You can do the ask fear and greeds from here, on in Well, it.

What a great answer, Michael, I think my job has become redundant. You can do the ask fear and greeds from here, on in Well, it.

Was very comprehensive aka wordy. I like to take a lot of story.

Was very comprehensive aka wordy. I like to take a lot of story.

Good Thank you Michael, Thank you Sean. Remember if you've got something you'd like to know, then send through your question on LinkedIn, Instagram, Facebook, or at Fearing Greed dot com dot au. I'm Sean Almer and this is ask Fear and Greed

Good Thank you Michael, Thank you Sean. Remember if you've got something you'd like to know, then send through your question on LinkedIn, Instagram, Facebook, or at Fearing Greed dot com dot au. I'm Sean Almer and this is ask Fear and Greed