New breed of savvy Australians embrace digital and choice in pursuit of home ownership
The Lendi Home Loan Index Q3 2018 (LHLI) unveils key trends among Australians searching for a home loan online*. The LHLI suggests that more consumers are taking financial matters in their own hands by embracing a digital-first approach in lieu of the traditional bank or broker model.
While the wider home loan industry is dominated by the big fours, the LHLI shows that Australians using Lendi are brand agnostic. In fact, 82.9 per cent of Australians don’t have a preference for settling their loan with a major lender.
The LHLI data also signifies Australians’ positive intentions when it comes to their own debt management. An overwhelming 85.5 per cent of owner occupiers who initially wanted interest only (IO) home loans eventually chose a principal & interest (P&I) loan.
“Many consumers don’t realise they have so many options at their fingertips. Our research shows that Australians are eager to make significant contributions towards complete property ownership,” commented David Hyman, co-founder and managing director of Lendi.
“When presented with more choice and the guidance of a home loan specialist throughout the process, the majority of owner occupiers swing towards more financially responsible decisions,” continued David.
The average owner occupier who has refinanced through Lendi is saving $2,198 off their mortgage annually and a drop in interest rates of 48 basis points**.
“With potential savings of over $65,000 over a 30 year period, this can have a significant impact on households and families – from major renovations around the home through to easing the pressure from everyday living expenses,” continued David.
The LHLI shows that from July through to September 2018, four in five Australians settled their home loan through Lendi without a traditional face to face meeting with a broker (80.3 per cent).
“There’s a seismic shift towards digital ecosystems that offer greater choice and transparency, coupled with the speed and convenience consumers demand. The Lendi platform was built exactly for that reason and is ideal for anyone juggling work, family and life commitments who don’t have the time for several face to face meetings,” added David.
The LHLI also reveals key motivators for refinancers in the last quarter:
43.9 per cent of homeowners wanted to reduce repayments and effectively, access cash savings
39 per cent of Australians wanted pay off their loan faster and be one step closer to home ownership
19 per cent of people wanted to consolidate loans and pay less interest on their debt
The discounted interest rates offered by lenders – across all owner and repayment types – fell towards the end of the third quarter. David added, “Lenders offer irresistibly low rates to attract new customers but existing ones aren’t rewarded for loyalty. It pays to do a bit of research and negotiate with your lender to ensure your mortgage is working hard for you.”
* The Lendi Home Loan Index Q3 2018 reflects on independent data from the Lendi platform. It focuses on customers who have settled their home loan using Lendi between 1 July through to 30 September 2018.
** Calculations based on refinanced P&I loans by owner occupiers from 1 January through to 30 September 2018. The difference in savings is based on customers’ previous and new interest rates. The potential $65,000 savings are calculated on a 30 year home loan with no interest rate rises.