In a home loan sense; are your needs being met?
Do you know what your needs are? Are they different to your wants? Have you separated your needs and wants?
If you’re buying a home or an investment property and you can’t pay cash, your need is the same ie you need a loan. This is a show stopper. No loan, no property.
But, your wants maybe very different depending on your circumstances and what you’re trying to achieve. As a general rule wants are less important than the main need which is getting a loan. Your wants reflect features of a loan. These could be an offset account, redraw facility, interest only payments, no mortgage insurance, a fixed interest rate, a “low” interest rate, principal & interest loan, building loan etc.
These types of features are important in making sure that the loan you get does what you want it to do. But they’re not normally show stoppers. ie if you couldn’t get an offset account, but you could get the loan, would you say no to the loan, particularly if it was the only one available to you?
Sometimes people say to me that they need the lowest rate going so that they can pay their home loan off quicker. Unfortunately, the “lowest rate going” changes on a daily basis. The main need here is to pay off the loan quicker, not the lowest rate. A few simple strategies can be put into place that will help achieve this need.
I want to add one other critical need when we consider the question, are your needs being met? That is, you need to be able to afford the loan you want. And, I don’t mean afford in the sense of what a bank or lender will lend you. I mean afford in it’s real life sense. Does the repayment of the loan sit comfortably in your budget?
You may want to have a large loan to buy an expensive property, but maybe, just maybe what you really need is a loan that you can afford and match your property expectations to the loan. Just a thought.
In a home loan sense; are your needs being met? If not please contact Paul; paul@halogenhomeloans.com.au, or 0410 520 398.
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