Don't know your APR from your ECB? Get smart, says Edel Morgan

SOME people seem to come into the world financially astute while others eventually acquire this astuteness, often after an epiphany. This epiphany can happen through sheer financial necessity or the shocking realisation that since adulthood, they've needlessly paid the banks outlandish amounts in interest through poor financial choices.

I'm guessing this group figures highly among the homeowners referred to in a press release by Irish Mortgage Corporation who are "increasingly aware they can move their mortgage from one lender to another for better value". The days when you take out a mortgage and unquestioningly stick with the same interest rate, and lender, forever are over. It's all about getting the best deal for yourself and applies to other loans, credit cards and high interest savings accounts.

For those who are still reaping dividends on their Communion money, this is all fairly elementary stuff, but I'm convinced there are lots of otherwise clued-in people who are not negotiating the best deal for themselves. Why do I say this? Because I happen to know some of them. In fact I was one myself, before my own epiphany, i.e. the deeply shocking realisation that I could be driving an Audi TT (which could now be traded in for a top-of-the-range people carrier) on the proceeds of my donations to the banks over the years.

The problem is, some of us are very aware of the money in our pockets but lose sight of the less tangible sums that leak out of our bank accounts in interest rates and hidden charges. This leads to situations where we would fight to the death for justice if we are overcharged for a meal while at the same time haemorrhaging enough money to buy the restaurant.

The tedium involved in keeping track of bank and mortgage statements puts many people off but Irish Mortgage Corporation advises homeowners to review their financial situation at least once a year. People often stay in the dark about matters financial because they are rarely discussed by friends or colleagues. "Did you get a load of the latest one year discounted tracker rate at 4.1 per cent?" tends to be a bit of a conversation stopper at even the dullest social event.

As a reformed financial-phobic, I am spreading the word with zeal that if your property has increased in value, you are in a position to negotiate a better interest rate with your bank. In doing so, I discovered that a friend, who holds down a responsible job and has a second property, was still paying a similar high rate of interest on the mortgage on her principal residence as when she bought it before the property boom. She noticed that the mortgage repayments on her home were nearly as high as on her investment property, which she bought years later at a much higher price but at a lower interest rate, but didn't fully realise she could do anything about it.

Then came her epiphany when it dawned on her that she let a fortune slip though her fingers over 10 years because she didn't switch to a lower rate. Sick to the core, she briefly considered contacting the financial regulator to see if there is some victims of banks compensation scheme but then realised she had partly been a victim of her own financial ignorance.

When I recently enquired about switching our mortgage to a lower rate, the bank insisted on a "drive-by valuation" whereupon a "valuer" arrived at our door and asked us how much our house was worth. When we told him, he wrote it down, issued us with a letter to that effect and relieved us of €100.

Once you become financially aware, it can be a mixed blessing. As you are elbow deep in bank statements and boggle-eyed looking at your home finance software package, you might start to yearn for those carefree days when you didn't know your ECB derrière from your APR elbow.