A welcome rate cut – but will it reach you?

EDITORIAL –

For the first time in four years, the Reserve Bank has delivered a 0.25% interest rate cut, offering a glimmer of hope for thousands of mortgage holders across the Central Coast.

With cost-of-living pressures mounting, any relief on home loan repayments is a welcome change.

The so called big four banks, eager to appear responsive and consumer-friendly, have been quick to pass on the reduction in full.

But don’t assume your lender has done the same.

As of Wednesday midday, reports indicate that several smaller lenders have yet to confirm whether they will follow suit.

This is concerning, as many Central Coast homeowners turned to alternative lenders after being knocked back by the major banks or drawn in by low introductory rates.

Now, those same lenders may be quietly holding onto the difference, increasing their profit margins at the expense of struggling borrowers.

This is not the time for complacency.

If your lender has not announced a reduction in your interest rate, take action – call them.

Ask them directly if they will pass on the cut in full, and if not, why.

If their response is vague or uncommitted, don’t hesitate to look elsewhere.

The home loan market remains competitive and by refinancing, some borrowers could save thousands over the life of their loan.

At a time when every dollar counts, holding financial institutions accountable is more than just good sense, it’s necessary.

The Reserve Bank’s decision was made to ease pressure on households, but that benefit only materialises if lenders pass it on.

So check your loan, make the call and, if necessary, take your business elsewhere.

Loyalty to a lender should never come at the cost of your financial well-being.

David Abrahams – Managing Editor