Australians are coming together calling for greater transparency on home loan pricing as people struggle financially with recent lockdowns.
Nearly 12 months on since the release of theAustralian Competition and Consumer Commission’s (ACCC) Home Loan Price Inquiry final report,a lot of borrowers are still feeling trapped and powerless.
The final report released in December 2020 found a “lack of easily accessible, transparent and straightforward pricing information, resulting in high search costs; and unclear, uncertain, costly and lengthy discharge processes that in turn cause borrowers to give up looking for alternative products.”
The ACCC also found, as reiterated by the federal government, “borrowers can save thousands of dollars in the first year alone by switching lenders or products or asking for a better deal, with older loans around 58 basis points higher than the average rate for new loans. This could translate to a saving of over $34,000 over the life of a $500,000 loan.”*
A group of homeowners have established www.notjustanumber.com.au to highlight the difficulty many are facing at this time and have started a petition calling on the big banks to:
- stop penalising loyal borrowers with unfair penalty practices on their home loans
- deliver more transparent pricing.
“Unfortunately, nearly a year later many existing customers are no clearer on home loan pricing,” says Kate McQuestin from Not Just A Number. “Many people are continuing to pay thousands of dollars more than what is being offered to new customers and feel powerless.”
“More than 6 million households have a mortgage on their property and behind every number, there’s a story. Whether it’s a teacher, nurse, first responder, small business owner, farmer, administrator or a stay-at-home mum - these people are all working hard to meet their commitments. We hope to help give them a voice and highlight the need for positive action.”
“Every dollar counts. Looking at an average loan rate, the big banks will penalise each existing customer around $2,000 this year and Australian customers don’t deserve to be slugged billions in 2021.”
“This $2,000 the banks are pocketing could cover a family’s annual electricity or gas bill for a year, a trip to see their beloved family when the borders open. Now, more than ever, Aussies need this money in their wallets. Not the banks.”
“In addition, there’s also a significant difference between what is advertised for new home loans and what consumers actually pay. And customers are still experiencing great difficulty in doing anything about it.”
“We believe the need for clarity is more important than ever with the impacts of COVID-19 putting increasing pressure on Australian households. People are sharing stories of raiding supermarket bins, going without food and feeling mentally overwhelmed as they do everything they can to make ends meet in these uncertain times.”
“People are being laughed at when picking up the phone in desperation to get a better deal, while others say they simply feel like the banks have them over a barrel. We’re hoping to give those without a voice a place to share their stories and be heard. We will also be doing our best to highlight the issues people are facing through the petition to the banks and Federal Government.”
“We just want to help deliver a fair go for Aussie homeowners at a time when many are doing it really tough- starting with a clear view of what new versus existing customers are paying - so we can make an informed decision with all the facts,”said McQuestin.
