Rates are rising. Don’t get locked out of your own home loan.

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The era of really low borrowing rates is sadly over, for now at least. Planning ahead is a good idea because rising or plateauing interest rates are predicted to continue over the next 12 – 24 months.

There’s a good chance the loan you currently have is no longer right for you. Worse still, your interest rate may no longer be competitive.

WHO CONTROLS THE INTEREST RATE IN AUSTRALIA?

In Australia, when we talk about interest rates rising, we are referring to the official cash rate. The official cash rate affects how much banks and other lenders charge for interest on home loans. So, when the official cash rate goes up, your home loan rate usually goes up too, particularly if you currently have a variable rate home loan.

Interest rate rises by the Reserve Bank of Australia

INTEREST RATES ARE ON THE RISE! SHOULD YOU CONSIDER REFINANCING?

HOW TO TELL IF REFINANCING MAY BE AN OPTION FOR YOU

  • Would you like to know if you can get a better rate?
  • Do you want to shorten your mortgage term (to pay your home off faster) or extend it (to lower your monthly payment)?
  • Are you trying to simplify your finances and save money by consolidating debts like your personal loan, car loan or credit card into your mortgage?
  • Would you like to consolidate higher interest debts to improve cashflow?

Refinance with confidence now, or risk getting priced out of the market.

Book an obligation free home loan assessment today!

WHAT DOES A RISE IN INTEREST RATE MEAN FOR HOME LOANS?

Borrowers on a variable rate, expect your interest rate to go up straight away. Within a day of the RBA’s latest announcement, all four major banks notified customers that they will be raising variable rates in line with the cash rate, and other lenders will mostly followed suit.

Borrowers who locked in record-low fixed interest rates in recent years are likely to face a substantial increase in mortgage repayments when your fixed terms end and you inevitably roll onto the lender’s standard variable rate.

Higher interest rates will translate to higher monthly repayments, so some budgeting might be in order.

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Interest rates affect your home loan

WHAT HAPPENS WHEN INTEREST RATES RISE?

Since borrowers have to pay more money to pay back the same mortgage, they can usually borrow less than they could otherwise.

When people have less borrowing and spending power, they can’t offer as much to secure a home.

With mortgages becoming more expensive, some people may find it more difficult to meet their ongoing repayments.

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GET IN TOUCH AND HAVE AN OBLIGATION FREE CHAT WITH US.

Let’s see how we can help find the right solution for you!

Email

info@brokerco.com.au

Address

Maroochydore Homemaker Centre, Level 1/11/55 Maroochy Blvd, Maroochydore QLD 4558, Australia

Phone

+61 7 5370 8333