Josh saved $71,163 by refinancing his home loan. How much could you save?


Credit Union SA

Member Experience Team

8 Sept 2019

| Home Loan

Like many home owners, Josh didn’t think twice about his home loan.

He happily made his repayments each month and went about his business.

But was Josh missing out on life-changing savings? Spoiler alert: yes!

“I’d never really paid much attention to what was happening in the world of finance and I had no idea what my interest rate was. In fact, I didn’t even really know what the official cash rate meant.”

Josh and his partner had taken out their home loan two years prior and felt like they’d got a pretty good rate.

“At the time we had a little look around and found what we thought was a decent variable home loan package, but neither of us really knew much about home loans.”

It wasn’t until Josh overheard his mate (Dan), talking about how he’d saved a ridiculous amount by changing home loans, that he started to get interested in ‘interest’ rates.

“I admit that even after I heard Dan talking about his savings – I still wasn’t 100% sold on changing loans. I assumed it would involve filling in lots of forms, paying fees, and for what – like a 0.01% drop in interest or something?.”

But after months of Dan’s relentless pestering, Josh found out what his interest rate was and started to look around.

“I was pretty sure that interest rates wouldn’t have changed much over two years. Well, I was wrong… seriously wrong! Because it didn’t take me long at all to find an interest rate that blew our current rate out of the water. The only thing was, it meant changing lenders.”

Josh had serious concerns about swapping lenders and it almost stopped him from moving forward.

“Really, I look back now and think it’s kind of funny that I was worried about swapping lenders because it was so easy.
Literally, we called up the new lender to find out more, and they sent someone out to our house for a chat, which was awesome. And then they just handled everything from there, we didn’t even have to have an awkward chat with our old lender to tell them we were leaving.”

Life changing savings #MakeItRain

So this is when things got real! Josh did his calculations…

Old variable rate – 4.35%

New variable rate – 3.19%

Refinance cash back – $2,500

Refinance costs (incl. govt fees) – $950.00

Overall savings

Based on Josh’s $300,000 home loan.

Monthly – $197.00

Annually – $2,364

Loan lifetime - $71,163

“So, the cash back offer we got for refinancing our loan well and truly covered our refinancing costs, in fact, we had over $1,500 left which we put towards our trip to Japan!

“It sounds really cliché, but refinancing has honestly changed our lives because it’s given us some wiggle room. It feels like we actually have a life again and get to enjoy doing things that we couldn’t afford to do before – just simple things like going out for dinner or weekend trips away.”

Funding a renovation without the HomeBuilder grant

Moral of the story

Josh not only knows his interest rate now, but he also pays a lot more attention to the market and interest rate movements. “I do take more notice now – really every homeowner should because it’s one of the biggest investments of your life.”

So perhaps it’s worth gritting your teeth through the RBA cash rate talk and interest rate jargon, so that you don’t miss out on life-changing savings.

Want to find out more?

If you are interested in refinancing your home loan, we’re more than happy to walk you through the process.

So why not make an appointment with one of our friendly Mobile Lending Managers who can come to your home or office at a time that suits you. Or call us on (08) 8202 7777 or visit us at 400 King William Street, Adelaide between 8am – 8pm weekdays or 8am – 2pm Saturdays.

This is general advice only and doesn’t take into account your objectives, financial situation or needs. Conditions, fees and lending criteria apply and are available on request.

Join Credit Union SA

Join Credit Union SA

Say goodbye to big-profit banks and enjoy the benefits of being part of a credit union that helps you do more with your money.

We're here to help

Contact us

Call us on (08) 8202 7777 or visit us at 400 King William Street, Adelaide