Save money by switching your bond, or renegotiating your interest rate

Struggling homeowners may be able to significantly cut their monthly bond repayments by renegotiating their interest rate or switching lenders.

Financial experts say many bondholders remain on rates that are far higher than what banks are currently willing to offer - largely because they have never asked for a review.

Banks rarely adjust rates automatically, even when a client’s risk profile improves, explains the CEO of ooba, Rhys Dyer.

Homeowners with a good repayment history, stable income and reasonable loan-to-value ratios are often in a strong position to negotiate.

“If you’ve been paying your bond for a few years without missing instalments, you’re no longer the same risk you were on day one,” explains Dyer.  “That’s leverage.”

Another option is switching the bond to a different bank, a process that has become cheaper and more competitive in recent years.

However, consumers are warned to look beyond the headline rate.

“Fees, remaining loan term and penalties all matter,” warns Dyer. “A lower rate doesn’t help if you extend your bond back to 20 years without realising it.”

The advice to homeowners is clear: review your bond regularly, compare offers, and don’t assume loyalty will be rewarded automatically.

“Even a small rate cut can translate into massive savings over time.”

For more details, listen to Dyer using the audio player below: