With Australia currently enjoying historically low interest rates there are many borrowers asking themselves “is now a good time to fix the interest rate on my loan?”
Many of us got a shock when the Reserve Bank of Australia met last week. After ten consecutive months of no movement the Reserve Bank dropped official cash rates by 0.25% to a historically low level of 1.75%.
We were then pleasantly surprised when some of our major Banks and lenders quickly announced that they would pass on the full 0.25% p.a. reduction to variable rate loans– albeit in most cases some weeks down the track.
So now a week later the question most borrowers are asking is – Did my lender drop their variable interest rates? If so, was it the by the full 0.25% p.a.?
There are many kids in Australia who have treated their parents as a ‘bank’ as they have grown up. Whether it was getting the newest game or latest technology before they had saved enough pocket money, or even as big as asking for assistance to buy a car in their late teens.
But these days with the cost of housing many kids are seeking much larger withdrawals and assistance from the ‘Bank of Mum & Dad’ to help them get into property ownership.
Lenders Mortgage Insurance, commonly referred to as ‘LMI’, is an insurance that covers a Lender should a borrower default on their loan and the lender incurs a loss.
As a general rule LMI is payable on Home Loans where the loan to valuation ratio (LVR) is greater than 80% and allows borrowers purchasing property to potentially gain a loan at up to 95% of the purchase price of a home.
Many professionals within the finance industry offer to provide a review of your current loans with terminology such as “Home Loan Health Check”, “Loan review”, or similar.
But what does this mean and what does it involve?
In essence our banking regulator, APRA, has flexed its regulatory muscle to try and control the level of growth in investment lending.
So why the increased regulation? Continue reading Lenders tighten investor lending policies
Over the last 10 – 15 years the usage of Finance Brokers in Australia has increased consistently and it is now estimated that approximately 1 in every 2 new home loans in Australia is sourced through a Finance Broker.
So why do so many borrowers utilise a Broker rather than going to their local Bank? Some of the benefits and reasons include: Continue reading Why use a Finance Broker?
There are many different strategies to repaying your loan back quicker than the approved term, but none of them include a “magic fairy” that miraculously repays large amounts off your loan! Continue reading Six ways to accelerate your loan repayment
With Australia currently enjoying historically low interest rates there are many borrowers asking themselves “should I fix the interest rate on my loan?” Continue reading Fixed versus variable interest rates – Should I fix my loan interest rate?