Has your home loan gone stale and costing you money?
Back on November 5th last year I wrote a blog called ‘The Back Book Effect’ warning of the dangers of paying more for your home loan than you need to. It’s an effect that I continue to see on a regular basis.
It appears when people have had their home loan with a particular bank or lender for a long period of time and haven’t reviewed it recently. We find the interest rate on their home loan is out of the market and higher than necessary. This happens for three reasons:
- Their loan product is no longer a current product with their lender.
- Their loan type no longer reflects their current circumstances.
- Their bank or lender hasn’t passed on full interest cuts, or has increased rates on existing loans.
Whatever the reason, the result is the same, you’re paying a higher interest rate than is available in the market.
There’s not a single person around who doesn’t want to pay off their home loan as soon as possible. Along with making extra repayments, a competitive home loan interest rate will help achieve this goal. If you’re an investor, a competitive interest rate helps reduce the costs of running the property and improves cashflow.
Long term consequences of paying a higher interest rate can be very costly. It would be better to divert some of the money you’re paying the bank in interest into your pocket?
Admittedly trying to find “the best deal” is like looking for a needle in a hay stack. Finding an option that will improve your financial situation is achievable. Go for the achievable not the impossible.
If you think you’re paying too much, send me an email with your details and we can investigate for you. paul@halogenhomeloans.com.au. It’s quick and painless and may put money in your pocket.
Wally Ayad says
Great post, very informative……….
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