In our latest update, last Friday (23 September) we released some functionality that we think is pretty awesome, and if you have a home loan with BNZ, there’s a good chance you’ll think so too. We’re giving home loan customers a way to measure the progress they’ve made so far, and a way to improve it.
Here’s how it works and some of our thinking:
As we all know, home loans can be massive and quite intangible as they often finish over 20 years in the future, which is a far cry off next week or even next year. We wanted to come up with a sense of progress that would still be relevant regardless if the loan was just beginning or near the end, big or small, fixed or variable. After a load of customer interviews, we decided to show how early the home loan was currently due to be paid off, compared with the original end date written in the loan contract.
In the example above, the customer (which happens to be me) is on track to pay their loan off 2 years and 3 months early. This is good, but I want to see what difference an extra $20-$30 a fortnight would make, as I think I can scramble this together from some redirected savings.
Next step is to click on the ‘Change your regular payments’ button. This will bring up the following screen:
From here I can play to my heart’s content, I can type any amount into the new repayments field, or use the buttons if that’s how I roll. Each time I try a new amount, I’ll see the potential impact this could have in terms of the interest saved over the life of my loan, and the time saved (these calculations assume that the interest rate will stay the same for the life of the loan which realistically is unlikely, but serves as a useful estimate). For this loan, after trying a bunch of different options, I’ve decided to increase my repayments by $20, and this will save me approximately $11,500 and take 1 year, 9 months off my current end date, which sounds awesome to me.
In this case, I didn’t need to pay an Early Repayment Charge - some people will - depending on the type of loan they have, their current repayments, and the amount of the increase. More information on Early Repayment Charges.
All I need to do now to lock this in, is press Change. I’ll get a confirmation step and then I’ll see these details updated on my home loan. By looking at this information across my other loans, I can get a sense of when I’ll be mortgage free - the thought of which puts a smile on my face.
We’ve setup a dashboard to track in real time how many years customers have saved off their mortgages. I can tell you that as at this second, over 600 customers are on track to save more than 2600 years, which, given most customers have only had access to this for a few days, is pretty awesome. It’s also a great example of how we’re helping customers (including me) be good with money.
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