Home-owners stand to save an average $40,000 over the life of their mortgages under new credit reporting laws introduced by Federal Government, according to consumer advocate group creditsimple.com.au.
The group’s CEO David Scognamiglio says Comprehensive Credit Reporting will be a game changer for mortgagees because banks will see the positive records of millions of homeowners for the first time.
Banks could previously only judge how much they could lend buyers based on their negative credit score. Under the new system, positive credit payment information that was previously held only by their banks will be shared with other lenders.
“Registries like illion.com.au will now house the new data, allowing up to 90% of home-owners to qualify for better mortgage deals,” Scognamiglio says.
He says the average mortgage holder may get up to 0.5% off their current mortgage rate once their positive credit history is included on their record. This meant a saving of $40,000 over 25 years for the holder of the average home loan.