Whilst it’s difficult to predict, future rate increases have been talked about a lot in the news lately and could put pressure on your household budget and lifestyle.
Can you prepare for a potential rate rise?
This will depend on your current loan structure what potential options are available to you.
Consider making extra repayments now to create a buffer for potential rate rises in the future.
Whether you are searching for your first mortgage or looking to refinance, you should always have a budget in mind before taking on a new loan.
How many rate rises could you endure before it started to impact your financial goals, such as home improvements or family holidays?
There are fixed-rate loans available which allow you to make extra repayments and therefore reduce your loan balance sooner.
Consider reviewing your home loan as it may not be competitive anymore with all the recent interest rate changes.
What to consider before fixing your home loan
Will you be keeping your property for the length of the fixed term? A lot can happen in the space of 12 months, let alone five years. Be aware though, if you are signed up to a fixed-rate loan and you switch home loans or sell your property in the fixed period that you may be liable for break costs which in some cases can cost you thousands.
Locking yourself into a fixed-rate loan will also limit your ability to access the equity in your property for your short-term needs.
Do your research
It certainly is in your best interest to keep abreast of interest rates and make sure your home loan rate is competitive.
Once you’ve established the fees and charges that you are required to pay, it will place you in the best position to be able to make an informed decision about the life of your home loan.
If you would like to know more about how we can assist you to refinance your home loan contact Financial Scope Melbourne for an obligation-free chat.
Disclaimer: Your complete financial situation will need to be assessed before acceptance of any proposal or product.
Clint Thomasson
Clint has over 14 years experience in Financial Services working with major corporates including NAB, AMP, ANZ, and AXA. With a passion for Mortgage Broking, coupled with his outstanding interpersonal skills, Clint’s drive is all about matching your needs with the right financial solution. Whilst many businesses offer Finance Broking services, the difference you’ll find with Clint is his ability to listen, engage, retain knowledge and accurately match your requirements. Not only that, but he’s also a very friendly and genuine person with a great work ethic – you’ll have full confidence that he will deliver in a timely and highly efficient manner, every time.
