How to secure better rates

John Deeks: Welcome to YourLifeChoices podcast, Mind Your Own Retirement, and our first guest is Matthew Gatt, general manager of Home Loan Comparison. You really are the rate comparison man, aren’t you?

Matthew Gatt: Ah well I guess so. I think I probably don’t see it that way as we’ve got a very strong team that supports me. So yeah I manage the business at the moment – we’re in a growth phase process right now.

John: Well, I would say this growth phase would be going gangbusters at the moment because people are having issues with their loans, people are wondering ‘are the banks gonna do me in?’. The banks are trying to be very nice at this time.

Matthew: They are.

John: They’re showing their warm friendly face. I’m thinking 12 months down the track is it still going to be still warm and cuddly and fuzzy from the banks do you think?

Matthew: Well I guess history would show that they tend to move in phases, and particularly coming out of a royal commission and so forth, you know it’s a great opportunity for them to show that they’ve potentially changed their colours. And I think they are doing a good job at the moment in supporting the community in a really difficult time, in a really challenging time. So credit where it’s due – I think that they’re doing a good job at the moment.

John: So, is it too late to get a better deal on your mortgage if you do have a mortgage on your property?

Matthew: Absolutely not, so I think recently we had a number of interest rate drops which has created a lot of competition in the market again as it does during these times. So it’s definitely a really, really good time to look and reconsider your options. When you take out a mortgage, quite often you can get in to a mode of ‘set and forget’.

And we don’t necessarily realise, as consumers, how rapidly the market changes and we’re in a record low interest rate environment at the moment. So there are some really competitive offers out in the market so it’s absolutely worth everybody’s while comparing what they currently have against what’s out in market. And there’s a number of ways that they can do that, but there’s definitely a value in doing that.

John: We have clearly challenging times ahead, not only (Treasurer) Josh Frydenberg, but our premiers in all the states have had their money men coming out saying ‘this is going to be tough’. How will that reflect upon people’s borrowings?

Matthew: Yes, so it is challenging. We’ve seen a lot of high unemployment at the moment that’s impacting people’s ability to obtain finance, so there’s challenges involved in the current market at the moment. I think the advantage of dealing with a mortgage broker, and a mortgage broking business, is the relationship that you build with that broker is over an extended period of time as well. So although you’re going through a challenging time at the moment, or some consumers are at the moment, we’ll find ways that over the period of just 3, 6, 12 months that we can build you up into a position where you’re in a stronger financial position. This will pass, things will improve in the future, and it’s really important to get started now so that when we are in that position where the market returns back to where we were just a few months ago, that you’re ready to go and you’re firing.

John: So there’s always someone to talk to?

Matthew: Yes, definitely the mortgage broking market in general is very customer focused. Just because there’s challenging times at the moment, we will come through this and we’ll come through it together, and I think it’s really important to make sure that you’re prepared for that.

John: Matthew Gatt our guest right now, the general manager of a Let me paint you a scenario, you have a son who owns a flat and the folks who are renting that flat don’t have any work, they can’t pay the rent. The son has a loan on it – can he negotiate with the bank/with his lender to get a better rate because of that?

Matthew: Ah so not necessarily a better rate, but what they can do is look at repayment holidays and repayment breaks so that it gives the son an opportunity to improve their cash flow at the time where he could be cash strapped at that time.

John: I know there’s rent relief coming through but all of this does take a while to come down the chain.

Matthew: It does yes, so you can talk to your existing lenders to get assistance with your existing mortgage and your repayments. As far as interest rates, you can definitely have that conversation with them. The competition is quite high at the moment, particularly with the low interest rate environment, so it’s always worth your while, whether it’s now, or in any type of market environment to give your bank a call and ask what offer they can do for you, particularly if you’ve held your mortgage with them for a number of years.

John: If people want to know more from your side where would they go?

Matthew: So is our website. We’ve got a team of mortgage brokers across the country to assist with a range of different scenarios.

John: And I guess this is changing all the time ..

Matthew: Absolutely, and I think that the advantage is that lenders are changing products, pricing, and policy almost on a weekly basis. So things are changing so rapidly at the moment, again particularly in the post royal commission environment. And the application process today is very different to what it was 6 to 12 months ago, so having somebody in your corner that’s actually guiding you through that process is critically important.

John: Is it going to cost me if I call you?

Matthew: No, not at all. So on a broker model we get paid by the lender that you choose to go through with, so there’s no fee to the customer at all and it actually doesn’t impact your rate with the lender either.

John: the place you should go1 Matthew Gatt the general manager of Home Loans at thank you for giving up your time. We live in interesting times.