Home loan haggling really pays off

HAGGLING with your home loan lender has proven to pay off for most and can end up in savings of tens of thousands of dollars over a loan term.

Many owner-occupier variable rates are below the 4 per cent mark and experts are urging customers to be chasing deals around 3.7 per cent otherwise they are simply shelling out unnecessarily.

The Reserve Bank of Australia is strongly tipped to keep the cash rate on hold at 1.5 per cent when they meet again today but customers should not remain complacent.

New analysis by financial comparison website Mozo has revealed of 1400 mortgage customers about two in five have haggled for a better rate in the past two years.

Of those about 70 per cent had success and got a discount.

Mozo spokeswoman Kirsty Lamont said “more of us should be picking up the phone to dial up a discount”.

“Have a five-minute conversation with your lender to ask for a better rate and be prepared,’’ she said.

“Lenders reserve their better rates for their hardest customers so don’t just accept the first discount they offer, push for a second one because chances are it might be better.”

Figures show on a $350,000 owner-occupier principal and interest home loan customers can save more than $36,000 over the loan term if they knock off an average of 0.5 per cent off their rate from 4.35 per cent to 3.85 per cent.