Your low-risk mortgage is keeping banks stable, so why not get rewarded?

You have been building savings buffers in your home loan. You are making it safer so shouldn’t you get a better deal? According to the RBA, you are keeping the banks stable. Don’t you deserve a reward? Banks publicly say how low risk most of their home loans are. The RBA goes further to say the stability of the banking system is due to households with lower loans to valuation ratio (LVR). From their own 2020 financial discussion paper: “the sensitivity of consumption to severe shocks appears to have increased over the past decade or two, as indebtedness has risen. However, our analysis finds that the banks would likely be resilient to such a scenario because of the significant amount of collateral backing their mortgage lending (that is, the moderate loan-to-valuation ratios on most outstanding mortgages).” So if households with low LVR loans are keeping the entire banking system resilient, why do they pay the same interest rate? With Our Leg Up, you can give yourself a discount. Make use of the equity in your home to lower your interest rate.