New research commissioned by UBank reveals only 16 per cent of Australians know the interest rate they pay on their home loan, even though it’s one of the most important indicators of financial health.
The Galaxy survey of around 1,000 people shows that while Australians have a solid grasp of some numbers in their lives, such as remembering their street number (97%), their online banking password (91%) or their car registration (77%), they don’t always have a grasp on many of the other important numbers in their lives, including their home loan rate.
The findings show a decline in people’s recall of their mortgage rate when compared to a similar survey from 2013, which found 35 per cent of men and 17 per cent of women surveyed said they knew their home loan interest rate with certainty. When compared to 2015, recall of mortgage rates has reduced even further, with only 19 per cent of men and 13 per cent of women able to recall their exact mortgage rate.
UBank CEO Lee Hatton said that with an average mortgage period of 25 years, mortgage holders who don’t keep a close eye on their interest rate can end up paying thousands of dollars more over the life of their loan.
“The survey is a timely reminder for people to keep track of how much they’re paying,” Ms Hatton said.
“It’s really surprising to see the number of people who don’t know their home loan interest rate as it’s one of the most critical numbers in any household, from a financial perspective.
“We want to encourage people to take some time over the holidays to look at their rate, and understand if there is something better for them on the market that can help save them money in 2016.”
Other interesting findings from the research included:
- Only 42% of Australians can remember their bank BSB, where 41% can only remember their bank account number;
- 73% can recall their parents’ phone numbers from memory; and
- Millennials (50%) and Gen X (49%) are less likely than Baby Boomers (41%) to reveal their income.
UBank offers a variable mortgage rate of 3.99%, which could save mortgage payers nearly $100,000 over the lifetime of a mortgage.*
The UBank survey results are based on a survey conducted by Galaxy Research, conducted in December 2015 on 1,005 Australians aged 18-64 in Australia have a mortgage. 2013 UBank research was conducted by Yellow Squares on behalf of UBank. 1000 Australian respondents aged 18-65, with a home loan, were surveyed.
*Savings estimate based on
- UHL (3.99%) Vs CBA No Fees Variable Rate (4.90%)
- $500k loan, P&I OO, Interest payment: monthly, 30 year
The savings for using a UHL are:
- $269 p/m
- $3228 p/a
- $97,095 over the life of the loan