Negotiating a lower interest rate on your property loan

The banks are customer hungry, meaning they’re willing to offer increased discounts to new customers and apply these discounts to existing customer loans, a mortgage broker has said.

mortgage loaning spi

Speaking on a recent episode of The Smart Property Investment Show, experienced mortgage broker Marissa Schulze encouraged investors to get on the phone to their bank and ask for a discount.

“Banks are extremely competitive and are willing to give increased discounts and apply those discounts to loans,” Ms Schulze said.  

“It definitely does make sense to call your bank and ask them for a discount. The worst they can say is no, but definitely, the banks are very hungry right now to retain business and get new clients,” she noted.

But the best way to get an effective outcome, Ms Schulze said, is by turning to an experienced mortgage broker.


“I think that definitely as mortgage brokers, we do have a bit more leverage to be able to get better rates for our clients when we’re negotiating with the bank. And that’s just because once we get involved, the bank knows you’re serious about leaving.

Recognising that some investors do prefer to do their own banking, Ms Schulze offered up some valuable advice, urging investors to approach the matter proactively.

“If you don’t want to get a mortgage broker involved and you want to do it yourself, then you basically have to make the bank convinced that you’re going to leave them. You have to call their retention team and say, ‘Look, I’m going to refinance. I’ve got a better rate here. Can you match it?”

“And just see if they’ll call your bluff. And if they don’t come to the party, then you need to be prepared to put your money where your mouth is, I guess, and actually look at refinance options,” Ms Schulze explained.

“At the end of the day, if you are serious about property investing, your investment loans are your biggest expense, generally speaking. You do need to be proactively looking at how you can get the best rate because that’s ultimately going to get you the best return, which is ultimately going to help you to grow your portfolio faster.”

Banks experiencing delays

But while the banks are swinging their doors open to new customers, according to Momentum Intelligence’s Broker Pulse survey, each of the four major banks is currently experiencing delays as strong consumer demand continues to put pressure on lenders. 

“Westpac, St.George Banking Group and ANZ continue to experience the longest turnarounds of close to and above 20 days to their initial credit decisions,” Momentum Intelligence said. 

“Commonwealth Bank’s turnaround times have continued to worsen again this month after losing ground last month.” 

Ms Schulze acknowledged the soaring interest, noting that mortgage brokers are bursting with business.

“I have never, ever seen this sort of buyer demand ever in my banking career,” Ms Schulze said.

But securing finance is generally “easy” for people with stable incomes.

“Basically, it’s the three S’s. You’ve got the servicing, the security and then your credit score. They’re the three things that you need to have to make yourself a good applicant for any bank.”

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