Rate rises encourage borrowers to consider non-bank lenders: One Big Switch’s Lachlan Harris

The decision by the major banks and some of the smaller banks to raise interest rates independently of the RBA is encouraging borrowers to consider refinancing with a non-bank lender, says One Big Switch founder Lachlan Harris.

Harris tells Property Observer there had been a “really, really strong reaction” to the rate rises, with borrowers “genuinely interested in smaller banks and non-bank lenders”.

“A few months ago it was all about the major banks, now the reaction is they want alternative lenders,” he says.

An ongoing poll by Property Observer has found that nearly 83% of borrowers are interested in the option of refinancing their mortgage with a different lender.

One Big Switch is currently in discussion with several other non-bank lenders, which are keen to join the campaign. One Big Switch encourages mortgage holders to consider refinancing.

To date Resimac, FirstMac, Mortgage Ezy, Mortgage Point and IMB Building Society have all participated in the program. About 1,600 out of the 40,000 borrowers who signed up have refinanced through one of these lenders.

Harris says the campaign will not be relaunched but those who signed up and who have not refinanced will be given the opportunity of participating in new lender offers.

“We are constantly in discussion with lenders interested in providing group discounts,” he says.

“We are always on the lookout for any lender who will offer a discount.”

Lachlan says the non-bank sector can match offers from the major banks.

“I genuinely believe Australia has a vibrant non-bank lending sector…it’s an incredible part of the market,” he says.

To learn more about refinancing, sign up for the free Property Observer refinancing webinar tomorrow at 12.30.