Homeowners are set to save on their loans following the Reserve Bank of Australia’s decision to cut the official cash rate for the second time this year. Yesterday’s drop of 25 basis points has seen the cash rate fall to a new historical low of 2%.
The Reserve Bank hopes that the cut will help boost consumer sentiment, which plummeted in April after rates were kept on hold. The looming federal budget and the rise of the Australian dollar were also reasons behind the decision to cut the rate.
It’s not all bad news, however, as the latest cut is set to make the cost of borrowing more affordable than ever.
Many lenders passed along February’s rate cut and it is expected that they will do the same this month, taking home loan rates to new lows.
With rates so low, now is not only a great time to enter the property market, but also a good opportunity to look at whether you could save money by refinancing. There are currently a number of cheap loan products on the market and, if you’ve had your loan for a few years, you may be able to save money by switching. Ask me how.
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