Australians need to explore their loan options

From first home buyers to refinancers, many Australians are looking to obtain a new banking product, according to Roy Morgan Research.

Data from the organisation shows that 1.6 million Australians aged 14 and above are considering taking up a new banking product within the next six months.

Of this number, the majority are considering a new home loan.

However, all too many of them are making a common mistake: Not weighing their options.

More than three quarters of those surveyed are only considering a bank for their new product, cutting out the possibilities offered by non-bank lenders.

In more favourable news for consumers, those considering a new loan are more likely to think about more than one bank than those planning to take on other products.

"While the banks focus on winning over customers when people are looking to switch products from one institution to another, the need for new products offers another ripe opportunity," said Norman Morris, industry communications director for Roy Morgan Research.

"A high proportion of people solely consider going to one bank for their new finance products, which creates a tough competitive environment for smaller institutions. This highlights how critical it is to keep customers satisfied for additional cross sell opportunities and maintain high levels of advocacy and awareness if they are to win new customers."

Exploring options is essential

There are many reasons why borrowers may decide to stick with only one type of lender, or a specific bank in general. One of the primary ones is comfortability, since consumers who have done business with a bank in the past will be more likely to stick with it for future needs.

However, when it comes to obtaining the loan option that suits their needs best, it's important for borrowers not to get stuck on one lender and eliminate the possibility of greater savings or features that better suit their lifestyle.