Switch your lender & save $3,800

Over the last 14 months of the GFC, many people moved their money and their business to a big four bank. Many people could simply not get a loan from anywhere except for a big bank.

That is now changing as credit unions, building societies and regional banks gear up for a renewed tilt at the dominant market share of the majors. And that means good banking deals are waiting to be found and big dollars are there to be saved.

“When looking at the complete cost of banking, including things such as service and transaction fees, ATM fees and interest rates, the major banks come out far more expensive than other, smaller lenders,” said InfoChoice CEO Shaun Cornelius.

“By simply moving to the lowest priced products in each category, a Big Four customer could save more than 19 per cent, or $3,800, on their annual banking costs. This would reduce their current average annual banking costs from more than $20,150 to just over $16,300,” he said.

Those savings can be achieved by the average customer with a mortgage, loan and credit card. According to InfoChoice, the biggest difference in rates is for car loans, which offer customers potential savings of up to 34 per cent – effectively cutting their bill by close to a third. The average car loan offered by the Big Four is 11.68 per cent, compared to the average of the lowest four with a rate of just 8.08 per cent.

The average mortgage customer with a $300,000 mortgage can save $3186 a year in interest payments and fees by switching from the major four banks (average rate of 5.78 per cent) to one of the cheapest four competitors (average rate of 4.92 per cent). Mr Cornelius said mortgage switching costs could be high but averaged less than $1000 for a standard variable home loan.

Source: Courier Mail