Time to Renegotiate or Refinance

 

Time to Renegotiate or Refinance?
How Your LVR Might Unlock a Better Rate

Over the last 12 months, Australian property prices have risen across many areas. While rising prices can make it harder for new buyers, existing homeowners may be sitting on a hidden advantage.

If your home has increased in value and you’ve been paying down your loan, your Loan to Value Ratio (LVR) may have dropped. When your LVR drops, your risk to the bank reduces – and that often means you’re eligible for a lower interest rate.

That’s why now may be the right time to renegotiate with your current bank or refinance to a better deal.

The 4 C’s of Credit – Why LVR Matters

At Awesome Lending Solutions, we often talk about the 4 C’s of Credit. These are the four key factors lenders use to assess your risk and decide:

• whether they will lend to you, and
• what interest rate they’re prepared to offer

The stronger your overall credit profile, the better the rate you can usually negotiate. LVR is one of the biggest drivers of loan pricing.

What Is Loan to Value Ratio (LVR)?

Loan to Value Ratio (LVR) is simply the percentage of a property’s value that you’ve borrowed.

It’s calculated by dividing your current loan balance by your property’s value.

For example:

• A $600,000 loan on a $800,000 home = 75% LVR

As your loan balance falls and your property value rises, your LVR reduces.

Why a Lower LVR Reduces Your Interest Rate

The lower your LVR, the lower the risk to the lender.

Think of it this way:

• At 95% LVR, the bank has only a 5% buffer if they ever had to sell the property.
• At 60% LVR, the bank has a 40% buffer.

That’s a massive reduction in risk, and lenders price loans accordingly.

As a real-world example, some lenders have more than a 1.00% difference between their highest and lowest interest rates purely based on LVR bands.

How Awesome Lending Solutions Helps

Free Property Reports
We provide complimentary property value reports so we can accurately calculate your current LVR.

We negotiate with your bank for you
For existing Awesome Lending clients, we use a specialist monitoring service that reviews your loan every six months and compares it to your lender’s best advertised rate.

For new clients, we manually approach your lender with:

• updated property value
• current loan balance
• their own best advertised rates

You don’t need to make the call – we handle it for you.

We compare the pair
If your current lender won’t move, we compare products from over 40 home loan lenders to see whether refinancing could leave you better off.

And It Costs You Nothing

Our service is 100% free. We don’t charge you to renegotiate, review, or refinance your loan.

We’re here to help you pay less interest, build wealth faster, and make sure your loan keeps up with your life.

If you’re wondering whether your LVR qualifies you for a better rate, let’s check it.

Albert Waldron
Finance Strategist & Director
Awesome Lending Solutions
📞 0420 977 960 | ☎️ 02 7904 9560