Let’s not sugarcoat this. 

Four rate hikes in just eight months is leaving plenty of home owners facing the squeeze of higher-than-expected loan repayments.

In fact, the cash rate is now sitting at 4.6%, a level not seen since 2011.

The difference is that 15 years ago, home loans were around half the size they are today.

But you may not have to simply accept a higher rate.

There could still be opportunities to save by switching to a home loan with a more competitive rate.

What’s a competitive rate right now?

While the big banks such as CommBank, Westpac and ANZ were quick to pass on September’s 0.25% rate hike, some smaller lenders are yet to announce their rate moves.

Once the dust settles, Canstar estimates the average variable rate for owner occupiers will be 6.49%.

This aligns with Reserve Bank of Australia (RBA) data.

However, a more competitive rate of 6.25% may be available through as many as 40-plus lenders, according to Canstar.

It could still even be possible to pay as little as 5.94%.

But bear in mind, these lower-rate loans may not be suitable, or available, for many borrowers.

Some have low loan-to-value ratios, making them better suited to home owners with a reasonable level of home equity.

We can let you know which low-rate lenders, if any, may be suitable for your needs.

How does your loan rate compare?

As many as one-in-two home owners are in the dark about their home loan rate.

But ignorance isn’t bliss when you’re being asked to shoulder a 1% rate increase so far this year.

If you’re unsure about the rate you’re paying, give us a call.

We can let you know for sure.

Unfortunately, more rate pain could lie ahead

What matters is that we have this conversation early.

The ink may be barely dry on the September rate hike, but that doesn’t guarantee we’ve seen the last of rising rates.

The RBA has left the door open for more rate increases.

CommBank sees the scale “tilted towards further rate rises”.

While ANZ believes a November rate hike is “more likely than not”.

Important next steps

If you have a variable rate home loan, chances are your interest rate is about to increase (if it hasn’t already).

Fortunately, you should receive several weeks’ notice before repayments rise.

This provides breathing space to decide your next steps.

A sensible starting point is to talk to us.

We’ll give you a clear picture of whether you can save on interest with a lower rate loan that suits your needs – and help guide you through the refinancing process.

Call us today to get started.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Following hikes in February, March and May, this latest 0.25% increase now brings the cash rate to the highest level it’s been in 15 years – since October 2011.

The RBA’s Monetary Policy Board said in a statement that since the previous RBA meeting, some of the upside risks to inflation had been materialising.

“There have been further disruptions to global oil supply and recent data suggest that growth and inflation in Australia have been higher than expected,” the statement said.

“Higher fuel prices have partially been passed through to prices of other goods and services. This inflation impulse is in addition to the effect of capacity pressures in the economy.”

Worse still, the rate hike pain for 2026 might not even be over yet, with the RBA signalling we could have another hike again before too long if inflation didn’t return to the 2-3% target range.

“The Board will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if needed,” the RBA statement said.

How could this affect your mortgage repayments?

Unless you’re on a fixed-rate mortgage, your bank will likely soon follow the RBA’s lead and increase the interest rate on your variable home loan.

For an owner-occupier with a 25-year loan of $500,000 paying principal and interest, this month’s 25 basis point rate hike means your monthly repayments could increase by about $77 a month.

That equals about $924 a year. Or $3696 annually if you also include the other three rate hikes.

If you have a $750,000 loan, your minimum monthly mortgage repayments may increase by about $115 a month. That’s $1380 per year, or $5520 including the previous three rises.

Meanwhile, a $1 million loan could go up by about $154 a month. That’s $1848 a year, and $7392 if you include the February, March and May hikes.

This all assumes that your lender automatically passes on the full 25 basis point increase to your home loan.

When did you last refinance your home loan?

This latest RBA hike is another tough pill to swallow for mortgage holders on a variable rate. It hurts, but there are still some steps you could potentially take to help offset the rate hike.

If it’s been some time since your last home loan review, now might be a good time to check in. 

There’s a chance you might be able to improve your situation by switching to a lender with a lower-rate home loan – potentially giving you a rate cut of your own.

Other options we could help you explore include renegotiating with your current lender, switching to interest-only for a period of time, or debt consolidation.

Every household is unique, and we’re committed to helping you find a solution that fits your needs.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

The 2026 Federal Budget may have changed many of the rules for property investors.

But a rental property can still be an attractive long-term investment.

And yes, you may still be able to benefit from negative gearing.

The key lies in the type of property you buy.

That’s because different rules will apply from 1 July 2027, depending on whether you buy a new or established property.

Let’s take a closer look.

What is negative gearing?

‘Negative gearing’ occurs when the costs of holding onto a rental property exceed the rent it generates each year.

Costs which may add up to exceed income include real estate agent fees, maintenance, mortgage interest and depreciation.

This loss is then claimed against an investor’s total annual income (including wages/salary), which can lower their personal tax bill.

Investors usually accept this annual loss on a rental property because they believe the profits that come from selling the place – known as ‘capital gains’ – will more than make up for the yearly shortfall.

How the rules for negative gearing are changing

From 1 July 2027, investors who buy an established property will only be able to offset the ongoing costs of a rental property against other income from residential properties or against capital gains arising from the sale of a rental property, rather than against their wage/salary income.

This may be fine for investors who own multiple properties.

The thing is, the vast majority of investors in Australia only own one rental property.

But that doesn’t mean the end of negative gearing.

Here’s the potential opportunity.

Under the Budget reforms, investors who purchase a newly built property – one that adds to housing supply – may still be able to use negative gearing as a way to save on tax and support personal cashflow.

Additionally, your current home could also be a negatively geared investment property in the future if you upgrade (or downgrade) into another home, and keep your existing home.⁣

That’s because the new negative gearing rules that take effect from mid-2027 only apply to properties purchased after 12 May 2026 – even if it’s currently your principal place of residence.

Why is negative gearing still being allowed for new properties?

Australia faces a well-publicised housing shortage.

And as our population continues to grow, more people are competing for a place to live in.

By allowing negative gearing for newly built investment properties, the government is hoping to boost the supply of housing. 

Newly built homes can have other advantages

It is important to speak with your accountant about any issues related to tax.

The ability to negatively gear newly built properties may be just one part of their appeal.

From 1 July 2027, additional Budget reforms mean that investors who buy a newly built property can choose to claim a 50% capital gains tax discount on the sale of the property (if they hold onto it for more than 12 months).

Or investors can use indexation to adjust gains for inflation and pay capital gains tax at a minimum of 30%. This is the method that will be used to determine capital gains tax on established properties.

There is another possible upside of a newly-built rental property, and that’s the potential to claim increased depreciation costs – both on the building as well as fixtures and fittings such as carpets, curtains and appliances.

Call us today

Yes, there have been reforms to how investment properties are taxed.

But financial experts generally agree that investment decisions shouldn’t be based on potential tax benefits alone.

Residential property has been a successful long-term investment for many Australians, and despite occasional dips, property prices have risen over time.

If you’re thinking about a rental property, call us for help finding an investment loan that could help make your goal a reality.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

There is no shortage of media headlines touting big falls in home prices.

But the reality may be less sensational.

While some property values at the luxury end of the market could be seeing price falls of up to 10%, it’s a very different picture at the more affordable end of the market.

We look at what’s happening with home prices, and why holding out for prices to fall further could  work against first homebuyers.

Good news for buyers: values have softened in most capital cities

The big picture is that home values nationally dropped 3.1% over the three months to September, taking annual price growth to just 2.7%, Cotality reports.

However, conditions vary between capital cities, and across market segments.

And here’s what first home buyers need to know.

Higher-value housing is recording larger price declines than affordable homes.

The affordable end of the market is proving resilient

As Cotality puts it, high-end homes are leading the downturn, while lower-priced houses and units are proving more resilient.

As a guide, in the three months to August, property values across the top 25% of the Sydney market fell by 5.7%. By comparison, values in the most affordable 25% of the market, fell by just 2.1%.

In Melbourne, the most expensive segment of the market saw values fall 5.3%, while the cheapest quarter of the market saw prices drop by just 1.3%.

And it’s a similar pattern across almost every state capital, Cotality research shows.

Hobart and Darwin bucked the trend, with home values in the most affordable segment of their respective markets rising over the last quarter.

These findings matter for first home buyers.

That’s because most first-time buyers start out in the more affordable end of the market – and that’s exactly where home values are experiencing softer price falls, if any at all.

Why are affordable homes seeing lower price falls?

Several factors are helping to limit price falls across affordable neighbourhoods.

These include steady entry-level demand.

In the June quarter of 2026, for example, over 29,000 first homebuyers purchased a place of their own. That’s about the same number for the same quarter in 2025.

Demand for affordable homes is also being supported by a range of first home buyer initiatives such as the 5% Deposit Scheme, the First Home Owner Grant and stamp duty savings initiatives.

It can also come down to numbers. There are simply fewer people who can afford to buy a luxury home.

What does this mean for first home buyers?

“Affordability” is the name of the game for plenty of today’s home buyers.

That’s because three rate hikes this year have reduced the borrowing power of many buyers.

Not surprisingly, that’s seen plenty of Australians hone in on affordable suburbs, which remain sought-after for their lower entry prices.

Across some cheaper suburbs, the number of online buyer searches has more than doubled compared to a year ago.

This doesn’t necessarily mean prices will rise in these neighbourhoods.

However, an increase in the number of buyers competing for a limited number of affordable homes may put upward pressure on prices – or limit the extent of any future price falls.

Talk to us today

As affordability pressures push demand toward cheaper markets, lower-priced suburbs may continue to be hot property among budget-conscious buyers.

This could see values in these areas hold their ground – or even buck the trend by starting to climb higher.

The bottom line is that if you’re a first home buyer, and you’re waiting for home prices to fall further, you could be disappointed.

Talk to us today to know if you’re home-loan ready right now.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Spring is traditionally the biggest selling period of the year for real estate.

It’s a season that can see more homes come onto the market, with listings rising, on average, by 15-20% compared to winter, as sellers take advantage of gardens that are in full bloom.

This year, spring is starting out on a different footing from recent times.

Plenty of signs suggest we are shifting to a buyers’ market, and that could be a plus if you’re looking for a first home, or upgrading to your next place.

Let’s take a look at what’s happening in the market, and how the experts see the season panning out.

Property values are softer

The good news for buyers this spring is that home prices are cooling in most capital cities.

Cotality’s national Home Value Index fell 0.9% in August.

That’s seeing home values nationally sit 3.6% below the market peak of March 2026.

The thing is, price declines aren’t occurring evenly across the board.

Across most state capitals, higher-value housing is recording larger price declines than lower-priced homes, Cotality says.

This may be a plus for upgraders.

Rather than being put off by selling in a softer market, upgraders may be able to take advantage of lower prices on their next home as they climb the property ladder – so long as they buy and sell within a relatively short time.

For example, a 3% price drop on a $1.5 million home that they’re keen to buy is a lot more than a 3% price drop on an $800,000 home they’re looking to sell.

More choice, better bargaining power

The supply of homes listed for sale across our major cities is now 24% higher than a year ago, and 8% above the 5-year average.

That’s quite a turnaround from last spring, when the supply of homes advertised for sale was below average.

Interestingly, the number of homes being advertised for sale by auction is down 31%. This may help reduce some of the stress involved in competing for a property at auction.

The upshot is that spring 2026 has the potential to tick plenty of boxes for homebuyers – more homes to choose from, greater scope to negotiate on price, and the potential to pay less for your new home than you may have a few months ago.

Will home prices fall further this spring?

No one really knows whether home prices will fall further or when they might start to level out.

What matters is a sense of perspective.

Westpac, for instance, is describing the current cooling property market as an “air pocket”, not a lasting downturn. It expects prices to stabilise as we head towards year’s end, then firm slightly over the course of 2027.

More homebuyers turn to a broker for help

One thing we can say for sure is that more Australians are now turning to their broker for help finding a home loan that matches their needs.

Mortgage brokers facilitated 82% of all new residential home loans during the June 2026 quarter.

That’s the highest market share on record.

It’s a clear sign that Australian homebuyers place a lot of value in having a broker in their corner.

Talk to us today

Is spring 2026 the season you will buy your first home, or next home?

Make us your first port of call, and enjoy the homebuying journey with a clear picture of your borrowing power, buying budget, and the reassurance of having a home loan that matches your needs.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

After three back-to-back rate hikes earlier this year, homeowners have enjoyed a welcome break from further rate rises in recent months.

But the reprieve may be short-lived.

Three of Australia’s four biggest home loan lenders have sounded the alarm on possible rate hikes, which could happen before Christmas.

We look at what’s driving the forecasts, and how you can plan ahead.

Inflation remains higher than expected

The Reserve Bank of Australia (RBA) has made it clear that it’s aiming for inflation of 2-3%, and only weeks ago, the RBA signalled it will “do what it considers necessary” to bring inflation down.

The trouble is, inflation is proving remarkably stubborn.

The latest CPI figures show inflation is currently sitting at 3.5%, and while it’s on a steady downward trend, 3.5% is still well above the RBA’s preferred range.

That’s seeing the major banks rethink their rate expectations.

Rates could rise as early as September

While the big banks hold differing views on the timing of possible rate movements, the common thread is that the next move may be up, rather than down.

NAB, for example, is expecting a 0.25% rate increase in just a few weeks – when the RBA Board meets in late September.

The Commonwealth Bank and ANZ Bank also expect the RBA to lift the cash rate by 0.25%, though not until November. 

Among the four major banks, Westpac alone holds the view that the next move for rates will be down – though it’s not expecting rates to fall until September 2027.

How a rate rise could impact your home loan repayments

If three of the four big banks are right, and rates rise by 0.25% over the next few months, this would see the RBA’s cash rate climb from 4.35% at present to 4.6% by year’s end.

We haven’t seen the cash rate at that level since 2010.

If it happens, a 0.25% rate hike could add around $91 to monthly repayments on a $600,000 loan with 25 years remaining, according to an analysis by Canstar.

On a $800,000 loan, monthly repayments could rise by $121, and on a $1 million mortgage with a 25-year term, a 0.25% rate hike could add $152 to monthly repayments.

What you can do now to prepare

No one can say with certainty if we will see a pre-Christmas rate hike.

But it certainly doesn’t hurt to plan ahead.

The first step is to check your current rate.

This gives you a baseline figure to gauge if you are paying more than necessary – regardless of any possible future rate hikes.

As a benchmark, today’s average variable home loan rate is 6.65%.

Close to 50 lenders are currently offering variable home loan rates below 6%.

Not all these loans will be suitable for every borrower.

Even so, it highlights the level of competition in today’s mortgage market – and a benchmark for what’s potentially available.

Why wait for possible future rate hikes?

We can let you know today if you could save by refinancing to a new loan and lender. Or, we could assist with asking your current lender to match what else is out there in the market.

Call us to find out how your current loan shapes up, and whether you may be able to access a more competitive home loan rate or improved loan features.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Mention ‘scams’ and it’s easy to think of dodgy investment schemes or fake online stores that take your money and never deliver the goods.

But scammers are getting smarter, and this Scams Awareness Week, we’re highlighting the dangers of property settlement scams.

Hopefully it will never happen to you.

But a recent survey found 42% of Australians couldn’t pick the warning signs of a property settlement scam.

Here’s what to look for – and how to stay safe.

What are property settlement scams?

Property settlement scams are one of the most financially devastating forms of cyber-crime in Australia, according to digital property settlement platform, Pexa.

That’s because the scammers target large sums – such as a homebuyer’s deposit.

The Australian Cyber Security Centre (ACSC) explains how the scams commonly work.

It starts with cyber-crooks hacking into the email accounts of real estate agents, conveyancers or even solicitors.

From there, they send fraudulent emails to customers who are in the process of buying a property.

The scammers insert the details of their own bank account for settlement payments to be made to.

Victims assume the payment request is real, and unknowingly send money to the cyber-criminal’s bank account.

The ACSC says these scams can go unnoticed for weeks, often only being picked up when the real estate agent or conveyancer follows up on the missing payment.

Meanwhile, the homebuyer may have lost tens of thousands of dollars, and potentially far more – money that was earmarked to buy a place of their own.

Property scams are becoming harder to detect

As scams become more sophisticated, they are becoming harder to detect, says Pexa.

Adding to the challenge, scammers strike during the final stages of a property purchase – a process many people are unfamiliar with.

So just how difficult is it to spot a scam email?

Harder than you may think.

Four in ten (42%) respondents to a Pexa survey couldn’t detect any scam markers in a simulated email, and a staggering 99% couldn’t spot the use of a fraudulent email address.

That’s because the fakes can be remarkably similar to the real thing.

Red flags to watch for

Several telltale signs may indicate a scam email.

These can include a slightly altered email address, and a change to the bank account details you’re required to deposit money into.

One of the biggest red flags is that you are pressured to pay immediately. 

Creating a sense of urgency is a common scam tactic used to scare people into acting fast before they can check if the request is legitimate.

How to protect yourself

Scamwatch advises taking three simple steps to protect you and your money from scammers: Stop. Check. Protect.

Pexa explains how these can work when you’re buying property:

Stop: instead of acting under pressure from a scammer, pause if you receive an unexpected request for money or changes in payment instructions.

Check: verify the payment request independently, either in person or by calling the property professional on a known number. Don’t simply dial the phone number listed at the end of the email – scammers may have inserted their own number there too. These days, many property purchases are facilitated by encryption platforms, so while you’re chatting, check if this is available.

Protect: take Confirmation of Payee warnings by your bank seriously. These let you know if the name of the account you’re sending money to doesn’t match the name you’ve entered.

Need more information?

Rest assured, most homebuyers enjoy smooth sailing with their property purchase.

And we are always keen to explain how the homebuying process works to keep you well-informed. 

Call us today for help on your home loan journey.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

While we’re far from a market collapse, it’s only natural for home owners to be concerned that their valuable asset could be worth slightly less than it was a few months ago.

In fact, national home prices are now 1.8% lower than they were in March, led by falling values in Sydney and Melbourne.

However, there may be an unexpected upside to cooling property prices.

And that’s the possibility that the Reserve Bank of Australia (RBA) may think twice about hiking rates again in the near future.

Here’s what’s happening.

The RBA is watching inflation

The RBA has made no secret of the fact it is aiming for inflation between 2-3%.

The trouble is, we are still a long way from that sweet spot, with inflation currently at 3.8%.

And here’s the thing: “housing” makes up one of the largest single factors contributing to the Consumer Price Index (CPI), which measures inflation.

Now, when it comes to CPI, “housing” doesn’t refer to the sale price or value of existing properties – but those sale prices do have a flow-on effect.

For starters, it’s believed that lower house prices can make home owners feel less financially stable, and in turn, they tend to tighten their belts. And it can have the opposite effect when property prices are running hot.

Additionally, when the property market is doing well, and more homes are being bought, more appliances and furniture are also being purchased – not to mention renovations, extensions and the hiring of tradespeople.

So it makes sense that a fall in property prices may help lower inflation, which could in turn reduce the odds of another rate hike.

This isn’t just a theory.

RBA assistant governor Christopher Kent recently said that softening property market conditions “heavily reduced” the need for further rate rises.

When will home loan rates go down?

We don’t have a crystal ball. 

It’s always hard to say with certainty how rates will move in the future.

On one hand, in early August, RBA governor Michele Bullock cautioned that future rate hikes can’t be ruled out if inflation looks like remaining higher for longer.

On the flipside, most of the big banks now expect the next rate move to be down.

The catch?

Even if the banks’ forecasts prove accurate, they aren’t expecting to see the cash rate fall before 2027.

The RBA has also noted that it doesn’t expect inflation to reach its preferred 2-3% target before mid-2027.

For home owners navigating higher rates, that could mean a long wait for any rate relief.

However, you might not have to wait at all

It may be possible to make a rate cut of your own.

Competition among lenders: a strong case for refinancing

Competition in the mortgage market is seeing almost 50 lenders offer variable rates below 6%, Canstar reports.

An owner-occupier who took out a home loan five years ago and who has never renegotiated, is likely to be paying around 6.97%.

If that sounds like you, it’s probably time for a home loan review.

Switching to a lower rate loan could see you save on repayments today, without waiting for the RBA to act.

Call us for a quick home loan health check and to find out if you’re eligible for a more competitive rate.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

As many as 49 different lenders are now offering variable interest rates starting with a 5, up from 38 at the start of June, according to Canstar.

That’s a powerful incentive to check the rate you’re currently paying.

If your home loan rate isn’t in the very low 6s or below, you could be paying too much.

Here’s why so many lenders are cutting their rates right now – and how you may be able to benefit.

Why are so many lenders cutting their rates?

Demand for home loans has softened in recent months, says credit reporting agency Equifax.

This follows rate rises earlier in the year, coupled with tax reforms relating to investment properties, which have contributed to a slower housing market.

The upshot is that lenders are facing stiff competition in the mortgage market.

And it’s a win for homeowners, with a growing number of lenders sharpening their loan rates as they battle it out for a bigger slice of the home loan pie.

The average loan rate versus a competitive rate

It’s always good to know how your home loan rate shapes up against the broader market.

As a guide, today’s average variable rate is currently 6.92%.

But why settle for average when you may potentially be able to pay less?

Dozens of lenders now offer variable rates below 6.0% – and in some cases as low as 5.69% – according to Canstar.

The rate difference may seem small but it can pack a big punch.

On a mortgage of several hundred thousand dollars, even a small reduction in your loan rate can lower monthly repayments – and deliver big savings over the life of your loan.

The fine print of home loan rates below 6%

Each lender has their own terms and conditions.

However, the common thread when it comes to loans with a variable rate below 6% is that you will usually need a deposit (or existing home equity) worth at least 10%, and more typically 20%, of your home’s value.

Some lenders impose even tighter loan-to-value ratios.

With a number of below 6% loans, you may need a deposit or equity as high as 30%, or even 40%, of your home’s value.

This is why it’s so important to talk to us. We can pinpoint which loans may be suitable for your needs and circumstances.

Why act now?

Homeowners have scored a reprieve from rate hikes – at least until the next rate decision in September.

Even so, the RBA has not ruled out more rate hikes in the future.

If rates do head higher, it could mean a fresh round of belt-tightening.

For instance, a rate rise of just 0.25% could add around $120 to the monthly repayments on an average $735,000 loan.

That’s not exactly loose change.

One smart move for borrowers is to consider preparing for another hike by seeking out a personalised rate cut.

Contact us today to find out if you may be eligible to switch to a lower rate, and start saving on repayments sooner rather than later.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.

Offset accounts are popular among Australian borrowers, with more than one-in-two (55%) home loans now having an offset.

If that sounds like you, chances are you may be concerned about a recent investigation by the Australian Securities and Investments Commission (ASIC) that identified problems with some offset accounts.

To help relieve any worries you may have, we reveal the banks ASIC reviewed, the main problem areas, and what you can do to be sure your offset account is helping you save on loan interest.

How home loan offsets work

An offset account is an everyday transaction account linked to your home loan.

The offset account typically works like a normal account, letting you make deposits and withdrawals any time.

But instead of earning interest on the offset account, the balance of the account is deducted from – or ‘offset’ against – your mortgage when loan interest is calculated.

For example, if you have $600,000 remaining on your mortgage, and $50,000 sitting in the offset account, loan interest charges will be calculated on $550,000 rather than $600,000.

As your loan repayments stay the same, more of each repayment goes towards paying down the loan, rather than paying interest.

In this way, an offset account can help you clear the home loan slate sooner, and reduce the total interest you pay.

What ASIC found

As a mark of how popular offset home loans are, homeowners currently have around $349.1 billion sitting in offset accounts – a figure that’s risen 28% in the past two years.

This growth prompted ASIC to look at how offset accounts are managed across eight lenders – AMP Bank, ANZ, Commonwealth Bank, Westpac, Macquarie Bank, ING Bank, HSBC and Credit Union Australia (now Great Southern Bank).

Together, these lenders make up about 70% of the mortgage market.

ASIC’s review picked up several issues, but the majority (55%) of issues identified related to unlinked offset accounts.

This is where an offset account was opened, but never linked to the borrower’s home loan.

This means affected borrowers paid more in loan interest than they should have.

Meanwhile, a further 22% of issues identified related to offset accounts not being opened when they should have been.

What are banks doing to fix the problem?

Lenders have already paid over $55 million in customer compensation for offset account failures.

ASIC expects more compensation to be paid following its review.

In addition, ASIC has put all lenders on notice to sharpen their systems, and has warned it will continue to monitor offset accounts.

What can you do?

The ASIC report didn’t say exactly how many home loans were affected by offset account failures, nor did it say which of the eight lenders had the poorest track record. 

However, the Australian Banking Association says problems were identified in “just hundreds” of the loans reviewed.

Still, that may be cold comfort if you’re affected.

The good news is that there are simple steps you can – and should – take to check if your offset account is working as it should.

A quick check is especially important if your loan has recently changed.

ASIC found problems with offset accounts were most likely to occur when a homeowner refinanced their loan or came off a fixed rate.

At this point, the link to an offset account can be broken, and you may need to contact your bank to re-set the link.

How to check if your offset account is working

To check if your offset account is linked to your loan, login to your banking app or online banking portal.

Click on your home loan account.

Then look for a section named ‘Manage’, ‘Offset Accounts’, or ‘Account Details’. This should show the account number of your linked account/s.

Or, take a look at your latest home loan statement.

It may display the account number of your linked offset account/s alongside the loan details, or in the section showing how loan interest was calculated.

If you are unsure, contact us and we’ll help you confirm.

We’re here to help

An offset account can help you save on interest.

But it may not be right for everyone.

Call us to decide if an offset account could meet your needs, or if a standard loan may be a more suitable choice.

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