Have you considered switching your home loan? If so, here is a checklist from Members Equity Bank (ME) to help you understand the costs versus the long-term benefits to your savings.

1. Determine how much your current home loan is costing you. You can do this by evaluating your interest rate and ongoing fees.

Your interest rate is the biggest factor in determining how much your home loan will cost you over the long term. Websites such as www.cannex.com.au and www.infochoice.com.au have calculators to help you compare loans. When comparing loans, be sure to use the comparison rate, which is the interest rate that includes most fees and charges. This is the real cost of your loan.

2. Consider the features you want from your home loan – does your existing home loan have these features?

• Do you want the peace of mind a fixed interest home loan provides, or do you like the flexibility of a variable interest rate?
• Have you considered a split loan that is a proportion fixed and a proportion variable?
• Are you able to make extra repayments?Have you considered an “Offset Account” which is linked to your home loan? The balance of the offset account reduces the amount of interest payable on your loan.
   

3. How much will it cost you to switch?

Determine the exit fees applicable to your current loan and add it to the establishment and ongoing fees associated with the new one. Does the reduction in the interest rate outweigh the costs of switching to your new loan? The lower the exit and start up fees, the more you will save. Consider switching to new loans with no establishment or ongoing fees, such as the Super Members Home Loan offered by ME, to really lower the switching costs.

4. Book a no-obligation home loan health check with a ME Mobile Lending Manager.

It’s a ME Mobile Lending Manager’s job to visit you at your  home or workplace to conduct a “home loan health check” to determine potential savings.  This may be in the evening once children have gone to bed or at lunchtime at your place of work.

To make an appointment with a ME Mobile Lending Manager, call 1300 309 374 or visit www.membersequitybank.com.au  

Members Equity Bank Pty Ltd ABN 56 070 887 679