WHAT CAN YOU DO TO MINIMISE THE IMPACT OF HOME LOAN INTEREST RATE RISES?

Mortgage Brokering

By Reece Droscher

The rise in the inflation rate to over 7% in the latest update has meant the Reserve Bank has again raised the cash rate this month to 3.85%. Since last May mortgage holders have seen 11 increases to their Home Loan rates. For some homeowners this has resulted in their loan repayments increasing by over $1,500 per month , so what can you do to minimise the impact of these changes?

1. REVIEW YOUR CURRENT HOME LOAN

As a mortgage broker I regularly come across people who have had a Home Loan with the same lender for five years or more. They have simply been paying the required repayment without ever thinking about what the current interest rate is, the fees that are being charged and what other lenders may be offering. In the current environment it is a mistake to assume that your current Home Loan is providing you with the best value. By having your loan reviewed a Mortgage Broker may be able to present products from lenders offering lower interest rates than you are paying currently. This could potentially save you thousands on interest costs or help you pay your loan off sooner.

Another benefit of having a review is to ensure the type of loan you have remains the most suitable to meet your current needs. Offset, redraw, the ability to make extra repayments or switching your rate between fixed and variable rates are all options your Mortgage Broker can review for you.

2. CONSOLIDATE MORE EXPENSIVE PERSONAL LOANS AND CREDIT CARDS

You may also have some smaller debts, such as credit cards or personal loans, that are charging higher interest rates but could be consolidated into your Home Loan. This could help repay these debts sooner by reducing the costs of these debts but would also simplify your finances, reducing the number of loans and repayments being made to multiple lenders.

3. NEGOTIATE A BETTER DEAL WITH YOUR CURRENT LENDER

Even without refinancing your Home Loan to another lender, your Mortgage Broker may be able to negotiate a better deal with your current lender. It costs a lender a lot more to attract new borrowers than to keep their existing customers, which is why they invest a lot of money in business retention teams. By looking at what competitors are offering your Broker can use this information to leverage a lower rate with your existing lender.

It is also important to note that a mortgage broker is required to act in their client’s best interest by law, which is different to the requirement on a lender when you deal with them directly. That is why the best person to review your Home Loan is your local Mortgage Broker. At SHL Finance we are already proactively helping our clients negotiate a better rate with their current lender, reviewing their existing loans and discussing ways to potentially save our clients thousands of dollars. We would love the opportunity to help you too.

Please call Reece Droscher on 0478 021 757 to discuss your options. reece@shlfinance.com.au www.shlfinance.com.au

By Peter Horton

The Ringwood Bowls Club would like to thank the many people who continue to request information on how they can become a member of our Club.

Here are the 2 classifications that are currently available at the RBC.

1) Full membership for people who would like to join the Club and in line with their past bowling experience be ready to play when the next pennant bowling season kicks off.

2) Social membership. The RBC provides membership opportunities on two fronts:

Social membership for people who would like to try their hand at bowling with the RBC providing both the equipment and specialised coaching. Your bowling career would start with social bowling held every Wednesday afternoon and during winter every Saturday afternoon. Social members can visit the club at any time and are welcome to join in social activities organised by the club.

If you are simply looking to join a Club then the RBC could be what you are looking for. Your reason for joining would not necessarily be aligned to any desire to play bowls. You may be looking to meet new people, make new friends and enjoy the companionship of other members of the RBC.