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It’s one of our most common questions… “We have already fixed our rate, but what is the situation with cash incentives for refixing?”

And a recent article in Stuff where four mortgage advisers talk about the “bribe” for customers to stay at the bank they’re with.

Whilst it’s an interesting article, I’d like to share our thoughts.

Getting a cash incentive to refix.

In short, it does happen, but it’s rare; banks definitely don’t dish them out willy-nilly. One of the advisers in that article (Hamish Patel) said customers should ask; they should ‘give it a go’. In my view, that’s about as successful as walking your kid through the junk food aisle in the supermarket – you know you’re going to be pestered about every lolly on the shelf, but you also know you’re going to ignore every time your arm gets tugged.

Our strategy is only to ask the bank when it is genuinely warranted, and we never ever just ‘give it a go’. The result is that when we ask, the bank takes us seriously. We try to demonstrate a customer’s specific value to the bank and why that should translate into a cash payment.

We are not always successful, but we never get the brush off either, and our success rate would be better than other advisers (like Hamish) for that reason.

Getting cash to switch lenders.

Cash incentives are offered to move banks, but this should never be a ‘give it a go’ option. You’ve got to go through the application process, and there’s a chance you won’t be successful. There is legal work to do (legal fees will erode some of the cash incentive). If you’ve got a split loan, then you’ll lose those good rates.

And you’ve got to consider the loan product you’re moving to – will it be the same or better, maybe worse?

My point is that moving shouldn’t be done just to scoop up a cash incentive, either. Hope that helps; happy to talk further or act on your behalf if this is something you think would benefit your situation.