What do people look for in a home loan?

When considering the most important feature in a home loan apart from interest rates, almost 80% of homeowners surveyed by the major bank said general home loan flexibility such as redraw facilities and multiple offset accounts, together with flexible features including the ability to change repayments in an app or online, were critical to them and their needs.

Meanwhile, almost 60% of those surveyed said being able to instantly change their repayment amount in their banking app would make a difference, while 61% said having the ability to change their loan type would make it easier to manage their mortgage.

CBA surveyed 1,000 people nationwide and of those surveyed, 599 were current homeowners.

CBA executive general manager home buying Dr Michael Baumann (pictured above) said when taking a closer look at Australian’s home loan priorities, there were subtle differences between what different generations wanted from their next mortgage.

“Baby Boomers listed an array of different flexible features as their top priority, with one in two saying a redraw facility was critical, while a quarter labelled multiple offset accounts as a must-have,” Baumann said.

“Further, 41% said general home loan flexibility, including the ability to change their repayments or loan type quickly and easily, would be an important feature when it comes to looking for a new home loan.”

Baumann said across the different generations, the data found Gen X was the most similar to Baby Boomers, with this generation labelling home loan flexibility as a top priority for their next home loan.

“While flexibility was still a top consideration amongst younger Aussies, so too were digital tools and the ability to easily access home lending specialists,” he said.

“Often dubbed as ‘digital natives’, it’s hardly surprising to learn 32% of Gen Z homeowners labelled an app for managing your loan in one place as a key feature for their next home loan.

“Interestingly, despite their desire for digital tools and features, this cohort also said support from their lending specialist was one of the factors they considered when choosing a future home loan, which shows the continued demand for a blended experience of digital self-service and expert support and assistance.”

Baumann said Millennial homeowners liked the ability to have flexible features, multiple offset accounts and redraw facilities, all of which were listed as top priorities.

“A home loan is long-term commitment and it is clear from the research that homeowners are looking for a mortgage and lender that can evolve with them throughout their life – a loan and home lender that is flexible and provides customers with the ability to make changes to suit their ever-changing needs,” he said.

“When homeowners were asked what their biggest concern was when it comes to taking on a home loan, more than 50% said they would be concerned if their loan wasn’t flexible and they couldn’t make changes to it as needed.

“This included concerns around not being able to make changes to their loan if their circumstances changed or that they would not be covered if something happened to their family and they couldn’t make their repayments.”

Source

Jayden Fennell, AustralianBroker | 12/11/2022