May 05, 2016
Consider refinancing while the going is good
With interest rates in Australia currently sitting at all time lows, now is the perfect time for those with a mortgage to review their situation and make sure they are still in the right product for their needs.
By reviewing your mortgage you may find that not only is there a better product available for your needs, but that you are able to save thousands of dollars in mortgage repayments over the life of your loan.
Say for example, you currently have a $300,000, 30-year mortgage with an interest rate of 5%, if you were to review your mortgage and ultimately shave 25 basis points from your interest rate, you could save yourself over $16,000 in interest over the life of your loan.
Before you attempt to refinance your mortgage though, it is important to do your due diligence and research what options are available to you - this includes looking beyond the interest rate alone. Many borrowers will look to refinance with a lender that boasts the cheapest interest rate, but just because they have the cheapest rate doesn’t mean their product is the cheapest loan overall or the most suited to your needs.
Before making any decisions, it is important to investigate the various fees each lender intends to charge. There are many kinds of loan fees borrowers may incur, including application fees, monthly account fees, redraw fees, additional repayments fees, rate lock fees and break fees.
Keep in mind though that you don’t need to do all of this on your own.
As professional mortgage brokers, we will be able to tell you what the real cost of a loan will be once all the fees and charges have been taken into account and step you through your options.
We can perform a free home loan health check to determine if your current mortgage is still the most suitable product for your needs by scanning through hundreds of home loan products from the 25 lenders on Mortgage Choice’s panel and, if necessary, help you source a mortgage that is better suited to your current needs.
To find out whether refinancing is a good option for you, contact me on 0448 010 501.