What is your current your home loan interest rate?What is your current your home loan interest rate? Many Australians won’t be able to answer this simple question, some don’t even know if their loan repayment are P&I or Interest Only, and whether their interest rate is competitive or not. Therefore, many Australians are paying much higher interest rate than it need be and are paying too much for their home loan. A recent analysis conducted by Finder suggests that Australian’s could save as much as $213 million a month if everyone switched to the cheapest interest in the market. In fact, only 3.63% of homeowners bothered to refinance last year, that's only 210,815 households for the entire country! The average homeowner stands to save as much as $18,000.00 over the life of their loan by moving to a sharper rate. If saving $18,000.00 is not enough motivation to be more diligent with your finances, then here are a few other drivers that may encourage you to look at your finances more often. Previous generations of home owners, taking out a mortgage often meant sticking with the same loan and lender for the full loan term. Not so these days. These sorts of numbers make it logical sense to ask, “why should I not refinance my home loan?” In fact, there can be plenty of reasons why refinancing makes good financial sense. Save money with a lower home loan interest rate The home loan market is very competitive, and lenders are constantly vying for your business. However, some may reserve their best deals for new customers. If you’ve had your current home loan for a few years now, chances are you could secure a better deal by refinancing. Pay your home loan off sooner A lower rate doesn’t just mean savings on the long-term cost of your loan. It can also reduce monthly repayments, freeing up extra cash to make additional repayments, and that can be the key to paying off your loan sooner. Access better loan features As our lives change, the sort of loan features we need can alter dramatically. A first home owner for instance may not have much scope initially to grow spare cash, but this can change very quickly, and an offset account can start to hold plenty of appeal as a way of using savings to trim interest costs. Even if your circumstances haven’t changed, it’s worth looking to see which innovative features you could take advantage of. Home loans are becoming more flexible all the time, and new types of features are being offered by Lenders all the time, some of these features could make a huge difference to your life, your banking and your debt reduction plan. Forge ahead with debt consolidation Debt consolidation is the process of folding multiple debts into a single low rate loan – usually your home loan. This can lower the rate you pay across all your debts to provide valuable savings on repayments, and free up extra cash to pay off your loan sooner. Switch between different types of rates Refinancing can be a chance to lock into a competitive fixed rate and enjoy more certain repayments, which makes your loan easier to budget for. Conversely, if a fixed rate term is about to expire, refinancing can let you make the switch back to a more flexible cheaper variable rate home loan. Put home equity to work Home equity is the difference between your home’s market value and the balance owing on your loan. It’s money you can access by refinancing your home loan, the available funds can be put to work achieving personal goals like purchasing an investment property, renovating your home, buying a new car, taking a holiday or paying for your children’s education. The key is to consider why you want to refinance and be sure that it’s the right step for you.

What is your current your home loan interest rate?  Many Australians won’t be able to answer this simple question, some don’t even know if their loan repayment are P&I or Interest Only, and whether their interest rate is competitive or not.

Therefore, many Australians are paying much higher interest rate than it need be and are paying too much for their home loan.

A recent analysis conducted by Finder suggests that Australian’s could save as much as $213 million a month if everyone switched to the cheapest interest in the market.

In fact, only 3.63% of homeowners bothered to refinance last year, that’s only 210,815 households for the entire country!

The average homeowner stands to save as much as $18,000.00 over the life of their loan by moving to a sharper rate.

If saving $18,000.00 is not enough motivation to be more diligent with your finances, then here are a few other drivers that may encourage you to look at your finances more often.

Previous generations of home owners, taking out a mortgage often meant sticking with the same loan and lender for the full loan term. Not so these days.

These sorts of numbers make it logical sense to ask, “why should I not refinance my home loan?” In fact, there can be plenty of reasons why refinancing makes good financial sense.

Save money with a lower home loan interest rate

The home loan market is very competitive, and lenders are constantly vying for your business. However, some may reserve their best deals for new customers. If you’ve had your current home loan for a few years now, chances are you could secure a better deal by refinancing.

Pay your home loan off sooner

A lower rate doesn’t just mean savings on the long-term cost of your loan. It can also reduce monthly repayments, freeing up extra cash to make additional repayments, and that can be the key to paying off your loan sooner.

Access better loan features

As our lives change, the sort of loan features we need can alter dramatically.

A first home owner for instance may not have much scope initially to grow spare cash, but this can change very quickly, and an offset account can start to hold plenty of appeal as a way of using savings to trim interest costs.

Even if your circumstances haven’t changed, it’s worth looking to see which innovative features you could take advantage of. Home loans are becoming more flexible all the time, and new types of features are being offered by Lenders all the time, some of these features could make a huge difference to your life, your banking and your debt reduction plan.

Forge ahead with debt consolidation

Debt consolidation is the process of folding multiple debts into a single low rate loan – usually your home loan. This can lower the rate you pay across all your debts to provide valuable savings on repayments, and free up extra cash to pay off your loan sooner.

Switch between different types of rates

Refinancing can be a chance to lock into a competitive fixed rate and enjoy more certain repayments, which makes your loan easier to budget for.

Conversely, if a fixed rate term is about to expire, refinancing can let you make the switch back to a more flexible cheaper variable rate home loan.

Put home equity to work

Home equity is the difference between your home’s market value and the balance owing on your loan. It’s money you can access by refinancing your home loan, the available funds can be put to work achieving personal goals like purchasing an investment property, renovating your home, buying a new car, taking a holiday or paying for your children’s education.

The key is to consider why you want to refinance and be sure that it’s the right step for you, if you require further information please contact us.

Declan Hanratty – Managing Director

M: 0409 089 456  F: 03 9416 1916  ABN: 19 880 907 430  POSTAL:  PO Box 1551  COLLINGWOOD  Victoria  3066 MFAA Membership No.  50217  Australian Credit Licence No. 383120  Credit Ombudsman Service No. 412201