Australian household budgets are under pressure, but fewer big banks are willing to compete for business from first home buyers and refinancers, who may instead start comparing options from alternative lenders, such as app-based digital banks.
Figures from the Australian Bureau of Statistics (ABS) show that refinancing is still strong, with borrowers switching lenders in response to rising interest rates. But while earlier in the year dozens of banks were offering cashback deals to attract business from these customers, today about a third of those offers are still available.
However, more digital mortgage lenders are coming forward to compete with traditional lenders. As these online lenders don’t need to maintain branch networks, they can focus on providing competitive home loan deals and innovative technologies to help you manage your household budget.
For example, digital bank Up offers fixed and variable home loans with competitive interest rates, and the option to buy with a 10% deposit (though you’d also need to budget for LMI). Extra repayments, free redraws, and 100% full offset accounts are also available to offer extra flexibility around managing your mortgage payments.
