Bank Borrowers `paying More'
Newcastle Herald
Friday February 6, 2004
NEWCASTLE and Central Coast bank borrowers with the average home loan have paid out up to $16,000 more in interest in the past eight years for the privilege of dealing with a bank, according to a non-bank lender.
Resi Mortgage Corporation said a statistical analysis of mortgage repayments to six major lenders between January 1, 1996, and January 1, 2004, highlighted the extra costs involved in borrowing from a bank.
The analysis, carried out for Resi by independent infomediary Infochoice.com.au, also revealed that at the end of the eight years many bank borrowers still had far more loan principal left to pay off than if they had dealt with a more competitive non-bank lender.
``With interest rates on the rise and many local home buyers having big mortgages, they can't afford to close their eyes to the results of this analysis clear dollar figures on how much extra a bank loan is costing them year after year," Steve Kehde of Resi Mortgage Charlestown said.
``It's the equivalent of giving your bank a new lounge or a wide-screen television each year just because you took out a loan with them instead of a more competitive non-bank lender," he said.
``Our advice is to have a good hard look at your home loan and see if it is costing you extra money you could be saving or spending on yourself. If it is, it's time to think about refinancing with a better-priced lender such as Resi."
The Infochoice analysis was based on an average $240,000 standard variable loan over 25 years and took into account all interest rate changes during the period researched.
It compared standard variable home loan repayments over the past eight years for six major lenders, including ANZ Bank, Aussie Home Loans, Commonwealth Bank, National Australia Bank, Resi Mortgage Corporation and St George Bank.
Of these lenders, interest repayments were shown to be the highest for the Commonwealth Bank ($131,565), closely followed by St George Bank ($131,497), ANZ ($130,894), National Australia Bank ($129,777) and then Aussie Home Loans ($124,616).
Interest repayments to Resi Mortgage Corporation on the average loan over the past eight years added up to $114,679, $16,886 less than the payments to the Commonwealth Bank.
``Our advice is to have a good hard look at your home loan and see if it is costing you extra."
REPAYMENTS ON $240,000 LOAN OVER THE PAST 8 YEARS
Institution Interest paid Principal paid Balance to date
ANZ Bank $130,894.01 $37,376.82 $202,623.18
Aussie Home Loans $124,616.07 $38,524.78 $201,475.22
Commonwealth Bank $131,565.55 $37,238.68 $202,669.12
National Australia Bank $129,777.65 $37,562.47 $202,437.53
RESI $114,678.94 $41,128.49 $198,871.49
St George $131,497.50 $37,276.86 $202,723.14
Source: Infochoice.com.au
© 2004 Newcastle Herald
Share This