Perfect time to negotiate a better rate

Perfect Time to Negotiate a Better Rate

Mark Stevenson, Managing Director at Bell Partners Finance (now Evolve Lending & Finance) wrote for The Western Weekender in August 2020 with timely advice for borrowers navigating the end of COVID-19 mortgage repayment deferrals, urging those in a position to resume payments to use the moment as an opportunity to negotiate a better rate.

Thousands of Australians had paused their mortgage repayments during the pandemic under the six-month deferral scheme offered by banks. With extensions available until the end of January 2021, many borrowers who had remained employed were in a reasonable position, having had the chance to build savings during the deferral period. But as repayments were set to resume, Mark made clear that returning to an uncompetitive rate was not something borrowers should simply accept. His message was direct: if the variable rate starts with a three, it is too high, and action is needed.

For those not yet able to resume full repayments, the banks were offering an additional four-month extension, though documented evidence of ongoing hardship was required to qualify. Mark acknowledged the cost of continuing to defer, as additional interest continued to accrue, but recognised that for some households it was a necessary trade-off.

For borrowers who reached February 2021 still unable to meet repayments, the guidance was to contact their bank proactively before falling into default. Banks had various tools available including extending the loan term, switching to interest-only repayments for a period, or consolidating debt, and most were willing to work constructively with customers to find a workable arrangement.

Mark emphasised the value of having an experienced broker in your corner for these conversations, particularly for borrowers who found negotiating directly with their bank uncomfortable or unfamiliar.

Whether you are resuming repayments or trying to find a better deal on your existing loan, having the right advice makes a genuine difference. Contact Evolve Lending & Finance today.