Australian mortgage holders have received millions of dollars in home loan cashbacks in the past two years, according to new research by financial comparison website Finder.
A recent Finder survey revealed 5% of respondents had negotiated or refinanced a home loan in order to take advantage of a cashback offer over the past 24 months. That number extrapolates out to 165,000 mortgage holders who have pocketed some cash from refinancing or taking out a new home loan.
The average mortgagor who received a home loan cashback offer pocketed $2,888 – equivalent to $476 million nationwide.
Richard Whitten, home loans expert at Finder, said refinancing can be a lifeline for cash-strapped borrowers.
“Millions of homeowners are struggling to make their repayments, so a cashback sweetener for refinancing is becoming even more attractive”, Whitten said.
“If you can lock in a cheaper interest rate and secure a cashback, it can add up to significant savings.”
Whitten warned, however, that borrowers should remember if the loan itself isn’t a good product for you, then the bonus simply isn’t worth it.
“The loan’s interest rate, fees and features are more important factors”, he said.
The Finder data showed 11% of mortgage holders had switched their home loan in the past two years without getting a cash bonus.
Men (9%) were three times as likely as women (3%) to have switched home loans and received a cashback bonus. Interestingly, women secured a higher cash bonus – an average of $3,800 compared to $2,431 for men.
The highest cashback offer on Finder at the moment is up to $4,000.
Whitten urged homeowners to see if they can negotiate a better deal with their lender.
“Even if you refinanced in 2022, it doesn’t hurt to review your options and see if you could still save more.
“If you have a fixed home loan and still have a majority of the term to go, you might have to pay a break fee to get out of the loan contract, but depending on how much you will save, this could still be worth it”, he concluded.
