Our home loan market is heating up, and Commonwealth Bank is turning up the pressure.
For the second time this month, CBA has cut its fixed home loan rates, this time to 5.69%, down from 5.84%, effective Friday, 30 May.
This move is the latest sign of intensifying competition among banks and non-bank lenders, all vying for a bigger share of an increasingly active lending landscape. With over 65 lenders adjusting their home loan rates in response to recent Reserve Bank decisions, we’re seeing plenty of opportunities to improve the position of our existing clients.
In this week’s newsletter, we look at what options are available when a borrower has a grievance with their broker or lender – fortunately we’ve never been party to a complaint, and brokers in general receive significantly fewer complaints than banks.
If a borrower has concerns about how their mortgage broker or bank has handled their home loan, there are several steps they can take to make a complaint and seek a resolution.
Start with the lender or broker directly
The first step should always be to raise the issue directly with the bank, lender, or mortgage broker involved. Most financial institutions and brokers have an internal complaints process and are required to respond within a reasonable timeframe, usually 30 days. It’s a good idea to put the complaint in writing and keep records of all correspondence.
Escalate to the Australian Financial Complaints Authority (AFCA)
If the issue isn’t resolved satisfactorily through the lender or broker’s internal process, borrowers can lodge a complaint with AFCA—the independent body that handles disputes in the financial services industry. AFCA can assist with a wide range of issues, including misleading advice, loan mismanagement, and unauthorised charges. Complaints can be lodged online and are free of charge to consumers.
Seek legal or consumer support
Borrowers can also contact a consumer advocacy group or community legal centre for advice. Organisations like Legal Aid, Consumer Action Law Centre, and Financial Rights Legal Centre offer free or low-cost guidance, particularly for those experiencing financial hardship.
Consider switching providers
If trust in the broker or lender has broken down, it may be worth exploring options with a different provider.
Raising a concern can feel daunting, but there are well-established channels to ensure borrowers are heard and fairly treated. Acting early and being clear about the issue can significantly increase the chances of a positive outcome.
Broker satisfaction runs high
According to the Australian Financial Complaints Authority (AFCA), in a six-month period, mortgage brokers accounted for only 0.7% of home loan complaints, whereas banks were responsible for over 82% of such complaints. This disparity highlights the higher satisfaction levels among clients dealing with mortgage brokers.
Variable
The rates below are based on a $500,000 loan, with the borrower making principle and interest payments with a loan term of 30 years. The rates quoted may vary depending on the borrowers LVR.
1 Year Fixed
The rates below are based on a $500,000 loan, with the borrower making principle and interest payments with a loan term of 30 years. The rates quoted may vary depending on the borrowers LVR. At the end of the three year fixed period, the borrowers interest rate will revert to a standard variable rate for the life of the loan.
