Do you know your home loan rate? 85% of Aussies don’t..!!
A recent survey conducted by UBank has revealed that 85% of Australians don’t know their home loan rate. 41% had no clue and 44% could only recall an approximate figure. If you’re one of these people, you should be aware that it’s costing you a lot more than just money.
The obvious benefits of a lower home loan rate are; saving on interest, increased cash flow, and shaving years off your home loan by paying if off sooner.
To illustrate, a 1% lower interest rate on a $500,000 home loan would result in $107,000 less repayments over a 30 year home loan. That’s significant in anyone’s language!!
Nowadays, knowing your home loan rate is even more important as the rules recently changed. Did you know that banks and lenders nowadays are charging a higher interest rate for investment related debt when compared to owner-occupied related debt? Some by as much as 35 basis points..!!
A 0.35% reduction in your home loan rate can add up to tens of thousands in money saved over time. Your home loan provider doesn’t know if your circumstances have changed. So for example, if you find that you’ve move into a property you previously owned as an investment, you need to notify your bank right away to have the rate reduced.
But if you really think about it, there are many other issues which is costing you if you’re not on the best possible home loan rate on an ongoing basis. Here is something to think about which may help you take action.
The benefits of a lower home loan rate and less interest paid are:
- More cash in your pocket
- More money to enjoy life’s pleasures
- More cash to accelerate your investment portfolio as you can afford to invest more
- Increased borrowing power therefore ability to create more wealth by investing sooner
- Pay off your home loan faster
- Travel more with the surplus cash
- Retire sooner
Buying a home or an investment property is one of the biggest investments of your life. It’s very important that your home loan rate remains sharp at all times, and not just when you first take out your home loan.
If your mortgage has been collecting dust for some time, or if you find your mortgage is not being managed on an ongoing basis, then our After Care program may be just what you need.
I’ll leave you with this frightening statistic from the UBank research. It was revealed that 54% of Australians are feeling financially strained, and 33% of Australians are constantly worrying about their financial future.
The best way to predict your financial future is to create it. The first and most important step is to ensure that your home loan is ALWAYS on the lowest possible rate, the rest will then start to fall in place.
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