Freedom beckons

A home loan can be a virtually watertight mechanism to grow your wealth – or, like a leaky bucket, leave much of your hard-earned money trickling into the lender’s profit pool. And an uncompetitive interest rate is often the main cause of the holes.

Let’s say you have two loan options: one from a big bank and another from a smaller or lesser-known lender. The big bank’s rate will quite often be a full 1% higher than the average charged by the rest of the market – even if you’ve managed to secure its top discount. The smaller, more streamlined outfits are where you find many of the home loan bargains – so much so that they always dominate the 10 cheapest mortgages list.

But 1% is not much, you may say.

It is when you apply it to a number as big as a home loan. In fact, on a $400,000 mortgage, for