If you are not a first home buyer, a switcher, nor an investor, we look at your options when you need to refix your home loan in the current uber-competitive mortgage market

The home loan market is watched closely.

We know the share of first home buyer activity is strong. And Reserve Bank data reveals the extent and quantum of borrowers who switch bank lenders - and that is rising too.

Investor activity is another closely tracked component of this market.

But if you are not among these targeted groups, how should you approach a re-fixing rollover?

Mortgage brokers are looking out to 'help' you. But do you really need them if you just want to roll-over your existing arrangements?

Brokers have all sorts of reasons why you should use their 'advice'. "We know the market and can get you a better deal" they say. But it is a dubious claim. In fact, the deal they may be able to "get you" may not be as good as you can do yourself.

Remember, mortgage brokers are paid by the bank - yes, they essentially work for the bank. Some in fact used to be bank employees, but when regulators essentially banned banks from paying their staff sales goal bonuses, they just shifted to work for mortgage brokers. They are still out there in force, still essentially paid by the bank, still exhibiting either a 'hunter' or 'farmer' sales personality. Further, in their broker groups, they sometimes don't actually survey all the options; rather they tend to pitch the lenders in their group's prioritised "lending panel".

There are about 7000 mortgage brokers in New Zealand, and only about 2000 are in a professional body that is committed to upholding standards. The scepticism in this opinion piece is more directed at the majority not in a professional association, rather than those who bind themselves to professional standards.

More than $100 billion in fixed mortgages come up for re-fixing between now and the end of the year. (Reserve Bank C33).

If all these were arranged by mortgage brokers, they would earn something like $850 million in commissions. Paid by banks. Obviously, not all the loans will be rollovers going via a mortgage broker. However, it gives you an idea of the scale of the potential issue.

And banks are on to it. App-based re-fixing options make it super easy to just do it with your existing bank, often incentivised with a small interest rate 'discount'. That cuts brokers out, to brokers chagrin. App-based refixing is a rising trend.

But don't just fall for that. Doing it yourself is a good idea and you should ask for the rate discount, the bank's cash-back deal plus a share of what they would have paid a broker.

That is even if you stay with the same bank. Essentially a "retention" incentive.

But first principles. You should always get at least three competitive quotes. Real ones. If you use a broker, be very wary of stalking quotes used to guide you to their preferred lender. 

Three truly competitive quotes should be what a broker offers you. And you can easily do that yourself. Yes, it is work, but work that pays off.

Lets work through an example to show how much you should chase.

Reserve Bank data suggests a year ago, the average property purchase loan amount was $555,000. For these purposes we will assume you now owe $550,000 and need to refix.

Assuming you had good financials when you took out the loan and at least 20% equity then, a one year re-fix will likely start with a carded rate of 4.90% interest rate. Tell the banks you are making this rollover competitive, and they should offer you a discount from that, possibly -10 basis points.

They will also likely offer you (if you ask) a cashback incentive. Most banks say their offers are for first home buyers, but it is common for cashback incentives to be used to entice new business or match a rival's offer. So ask firmly. The fine print on these incentives vary by bank but something like 1% borrowed in an upfront cash incentive is likely to be available. For a $550,000 loan, a benefit of $5500 is the range you can expect.

But remember, in return the bank will want a commitment of your business for a period longer than one year, usually three, sometimes four. So cashback is not a benefit you can negotiate "every year".

And the harder you push for an interest rate discount, the more resistant they will be on the cashback side of things.

Not using a broker is also valuable to the bank - probably more valuable than you realise. Broker business for the bank is highly unstable. So a bank will appreciate (and value) the chance to have a direct relationship. (And get you on their app.)

Typical brokerage is 0.85% of the loan amount (sometimes 0.55% up-front plus a trail commission). You may not get a bank to agree to offer you all of that, but on a $550,000 loan, at least $4500 is what they would pay the broker.

Judging the value of these benefits will require some simple figuring out. You are unlikely to be offered the sum of all three, especially if the bank offers you other incentives like a contribution to your legal fees, or if you have insisted they waive their application fee.

But don't be intimidated. All you require is some simple high school arithmetic. Lay out the various offers on one sheet of paper or the notepad app on your phone or laptop. It will quickly become clear who has the better deal.

You will of course need to apply your own motivations to the process. Do you want a cheaper interest rate, or cashback? If you get cashback, is it for spending now or will you use it to reduce the loan balance? All are your choices, ones that will affect how you value the various offers.

In the end, in our example you could be looking at something like a 4.80% interest rate and cash incentives of $6000 to $8000. Every mortgage calculator you use will suggest the best long-term use of the incentive is to pay down your loan faster. That is the maths. But your circumstances might judge this differently.

A simple initial rejoinder by a bank to a request for a better deal might be to offer a "retention bonus" of something like $1500 or $2000. If you haven't done the work to create a competitive situation, that may seem attractive. But it is clear that there should be a lot more on the table if you can commit to doing the work. Likely it will be the best use of your time, ever, on a $-return-for-the-time-spent basis.

Many people are timid when negotiating, especially negotiating with people they think are experts. It is true, it can be. But if you have a mortgage, you are going to be doing this every one- two-or three years over the life of a 30 year mortgage - about 10 to 20 times. So if this is going to be a frequent task, best to build yourself some confidence in the process.

And remember, always get three quotes to compare. Certainly not just one, and really avoid limiting it to two. Three, minimum. (If you end up using a broker and foregoing some important benefits, insist they get three proper quotes too. It will be telling if they say only one is really necessary, but this is just code for them treating you as churn fodder.)

This review is aimed at borrowers who already have a mortgage. And it has been somewhat sceptical of the value mortgage brokers bring to the transaction. But to be clear, a good mortgage broker can be very valuable in some circumstances. And that is especially true when you are new to the process.

They can help you organise and prioritise the information you will need for a first home loan, especially when your finances are tight.

They can suggest loan structures you may not have thought about.

And for some people who have trouble with financial concepts and numbers generally, a good financial adviser is a godsend. There certainly is a place for mortgage brokers.

Our sceptical view primarily comes from how they are paid. They are hopelessly conflicted. Despite all the touchy-feely words (and even the regulator's insistence to put the clients interests first), the whole thing slides because of the inherently backward financial incentives. They do it right in the Netherlands, so there is a successful working alternative to the conflicted way we do it.

Here is the snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at the moment.

Fixed, below 80% LVR	6 mths	1 yr	18 mth	2 yrs	3 yrs	4 yrs	5 yrs
as at July 13, 2025	%	%	%	%	%	%	%
ANZ	5.29	4.95	4.89	4.95	5.09	5.79	5.79
	5.29	4.89	4.89	4.95	5.09	5.49	5.59
	5.29	4.89	4.89	4.95	5.09	5.39	5.59
	5.29	4.89		4.95	5.15	5.59	5.79
	5.29	4.89	4.95	4.95	4.99	5.39	5.39
Bank of China	5.08	4.78	4.78	4.88	4.95	5.35	5.35
China Construction Bank	5.15	4.85	4.85	4.95	4.95	5.99	5.99
Co-operative Bank (*=FHB only)	5.25	4.79*	4.95	4.99	5.15	5.49	5.59
ICBC	5.15	4.85	4.85	4.95	5.05	5.35	5.39
	5.36	4.89	4.89	4.95	5.09	5.39	5.39
	5.29	4.89	5.09	4.95	5.29	5.79	5.89