Rates on hold: What borrowers should do next
All owner occupiers paying off a mortgage should put pressure on their lender and make sure they have an interest rate that starts with a "2" experts say.
The Reserve Bank of Australia board met again today - the third time in five weeks - and kept the cash rate on hold at just 0.25 per cent.
It comes after two rate cuts in March.
Financial comparison website RateCity's database showed there are now more than 100 lenders who are offering owner occupier principal and interest rates under the three per cent mark.
The site's spokeswoman Sally Tindall said borrowers should be putting pressure on their lender to give them a rate with a "2" in front, even if they were opting to take a mortgage deferral.
"The biggest rates are often reserved for people willing to refinance over to a different lender," she said.
"Lenders are throwing ridiculously low rates on the table for owner occupiers looking to switch."
But Ms Tindall said for those who had lost their job or a big chunk of their income not to despair, they still have options.
"Anyone who has lost their job or has lost a large portion of their income might find it hard to refinance until they are back on their feet financially," she said
"But this shouldn't prevent them from picking up the phone and asking their lender for a current rate cut."
Variable rates are as low as 2.39 per cent while one, two and three-year fixed rate deals are as low as just 2.09 per cent.
The Mortgage and Finance Association of Australia's chief executive officer Mike Felton said for borrowers should take the time to check the fees and charges on their loan.
"We would recommend that those that are meeting their mortgage obligations review their loans more regularly to ensure that they are minimising the interest, fees and charges associated with their home loan," he said.
"Variable and fixed rates mortgage rates are at record lows and customers need to be ensuring that they are getting a fair deal for their given circumstances."
He said for those in hardship they should reach out to their lender or broker as early as possible.
"The lenders have put in place a number of measures to assist those in COVID-19 related hardship without affecting the customer's credit rating by offering a deferral of payments for up to six months or a reduction of payments for a period," Mr Felton said.
"The sooner the consumer engages with the lender the sooner such assistance can be made available."
Mortgage Choice chief executive officer Susan Mitchell said they had seen a strong increase in the number of inquiries from borrowers.
"A significant proportion of those inquiries are from borrowers seeking reassurance that they're on the right track, other borrowers want to ask about refinancing or fixing their rate and some are wanting more information about deferring their home loan repayments," she said.
"Borrowers are feeling uncertain about their finances and the economic outlook and many want to know what their options are."
While Aussie chief executive officer James Symond said it's more important than ever to know what interest rate you are paying on your home loan.
"If you're not sure where to start, speak with a broker," he said.
Originally published as Rates on hold: What borrowers should do next