Yellow Brick Road: Home

Busting Mortgage Myths

Lately I’ve been running Q&As with some of our local customers here in Darwin, answering their questions about mortgages. I’ve noticed there’s a large number of myths and misconceptions about mortgages that keep coming up, so I thought I’d address the 8 most common:

1.   Once I find a good rate, I’m sorted for the life of my loan. False! Lenders are free to move their variable rates at any time. This means that a loan that might be competitive today may end up being less competitive in the future. So, it’s important to take a look and revaluate your loan at least once a year and make sure you’re getting the best rate.

2.   It’s not worth refinancing a mortgage for an improvement of half a percent. Or is it? Suppose you have a $350,000, 30-year loan with an interest rate of 5.24%, and you decided to refinance it to a rate of 4.74%. You would save $107 a month and $38,480 over the life of the loan. That’s a massive saving that you could easily take advantage of, so speak to one of our mortgage brokers today!

3.   A competitive rate doesn’t really matter because the Reserve Bank controls home loan rates. While the RBA adjusts the cash rate from time to time, each lender can change their rates as they see fit. So it’s crucial to make sure you compare rates between lenders and see your mortgage broker to get the best deal.

4.   I can’t refinance a fixed-rate loan. False! You can refinance a fixed rate loan but you’ll be hit with a break cost, which is compensation for the loss the bank will incur when you leave. Talk to your local mortgage broker to weigh up the break costs versus the potential savings and see what you come up with. Unsure? Our Yellow Brick Road mortgage brokers here in Darwin are always happy to help you out.

5.   I want to use a mortgage broker but what about the fees? Mortgage broking fees are paid by the lender, not by you. A mortgage broker finds you the best loan at the most competitive rate, so pop by your local Darwin branch and speak to one of our skilled mortgage brokers today.

6.   I’m too old to refinance my mortgage. Age discrimination is illegal. A bank looks at your repayment ability, so they’re looking at your income and the loan term. If you’re close to retirement, you can look at shorter loan terms or alternative exit strategies. Just remember, it’s never too late when it comes to refinancing your home loan so contact one of our mortgage brokers today.

7.   Self-employed people pay higher interest. If you’re self-employed and can’t produce your tax returns, you may be offered a low documentation loan which can have higher interest rates. If your financials and tax returns are in order, you qualify for the same rate as a regular PAYG employee.

8.   Banks keep secret files on my credit history. Wrong. All lenders use a credit reporting system to check your history. Know what they know by finding out your history at


Mark Gilliam’s Top Mortgage Tip: Get Informed

My parting advice: be informed before signing anything and always communicate with your local mortgage broker. Most lenders would rather find you a better deal than lose you as a customer. If you have any questions or would just like to chat about how we can help you refinance your loan, make sure you give our Darwin branch a call today so we can help you save for tomorrow.

Arrange an appointment

Stay in touch

Submit your details below to receive news and offers from Yellow Brick Road.

Please enter your first name
Please enter a valid email address

We will not share your email address with others. View our privacy policy