DID YOU KNOW A .5% DISCOUNT ON YOUR INTEREST RATE CAN SAVE YOU OVER $55,000 ON A 30 YEAR HOME LOAN!
Yes, that is a huge amount of money, in fact a very reasonable annual wage. This was calculated as an example on a $500,000 Home Loan repayable over 30 years, at 5% pa you would pay back $966,240 and at 5.5% $1,021,680, a difference in repayments of $55,440.
This highlights the importance of managing your fixed and floating rates, what is the best interest rate option for you? Floating rates are often higher than fixed, so it makes sense to fix for a term, as this gives you the opportunity to either focus on debt reduction by paying more, or reducing repayments to free up more cash for day to day costs. With a new Home Loan we can request the Bank for their best discounted rates for floating, 1,2,3,4 and 5 year terms and then discuss how this will best work with your personal situation. We will then record the expiry date and structure, so we can assist you manage future fixed rate expiry dates.
If you are checking out the best interest rates online, as you have always dealt with your bank direct in the past, you can discuss with us what options exist. We have often even approached a client’s existing bank and obtained a better interest rate than they were offered, or suggested an alternative structure by splitting their loan into say a 1 and 3 year fixed term to manage risk.