The Money Mindset Report, published by Pepper Money, has revealed 71% of 1,011 survey respondents said they would spend time researching different options before choosing a phone plan, while only 61% said the same thing about a home loan.
More than half (53%) of those surveyed admitted in the past they had taken the first loan offer they received without considering alternatives.
This is despite 65% agreeing that financial products are the most important area to seek out a second opinion, ahead of health related matters and major purchases.
Respondents cited a couple of reasons for their lack of due diligence:
- A fear of being turned down elsewhere, desire to secure fast finance and relief at being approved for any loan in the first place were the most common.
- Time pressure and rejection fears also contributed to many people being willing to compromise on the products and features of their loan.
The research indicated that certain participants would make concessions on speed of approval (43%), a linked credit card (41%), account features like an offset account (31%), and even interest rates (27%).
Pepper Money CEO Mario Rehayem stressed the importance of carefully considering all of the available options for a loan.
"The finance market has so many different lenders and variables that it can feel confusing to navigate; but taking the extra time to find the best option for your circumstances can make a much bigger real life difference to the household budget than your choice of phone plan," Mr Rehayem said.
"Whilst nearly 80% of those surveyed for the Money Mindset Report said they believe sometimes compromises need to be made to secure a loan, the Australian financial landscape is vast and many people will have multiple options available to them."
This comes as the Mortgage and Finance Association of Australia (MFAA) reports a record breaking proportion of borrowers (70%) are outsourcing these decisions to mortgage brokers,
The research across 18 mortgage brokers' clients also suggests the majority of these people are content with the experience.
Most (81%) respondents who had used a broker previously said that they would do it again.
"More than ever, borrowers should have an expert, like a broker in their corner to help them understand all the different lenders and loan alternatives available without all the stress," Mr Rehayem said.
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| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.04% p.a. | 6.06% p.a. | $2,408 | Principal & Interest | Variable | $0 | $530 | 70% | Featured Online ExclusiveUp To $4K Cashback |
| |||||||||
5.99% p.a. | 5.90% p.a. | $2,396 | Principal & Interest | Variable | $0 | $0 | 80% | Featured Apply In Minutes |
| |||||||||
5.99% p.a. | 6.51% p.a. | $2,589 | Principal & Interest | Variable | $0 | $530 | 90% |
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