We’re always looking for way to save money, but one
place where people forget to look also happens to be their biggest household
expense: their mortgage. And I believe the reason why people don’t look closer
at their home loan is because the idea of refinancing seems too difficult, too
confusing, or is perceived as probably not worth it for the effort. If you’re
one of those people, it’s time for you to speak to a mortgage
broker and ask yourself some questions.
What’s my rate?
In my experience, many people know what their monthly payments are, but they
don’t actually know their interest rate, let alone what it all
means. Do you? Take a look – if it starts with a “5”, it’s
time to shop around because I know you can definitely do better and at Yellow
Brick Road Gladesville we’ve got the experience and resources to help you get
What does the
Use a comparison site and find out what’s
on offer. The current market for variable rate mortgages runs from high 3% to
over 6%. Three-year fixed rate mortgages range from the low fours to well over
6%. There’s a lot of difference, which means there’s solid scope for savings There’s
a lot of difference, which means there’s solid scope for savings.
What could I
Use the comparison sites to calculate several results. If
you have a $350,000, 30-year loan with an interest rate of 5.24%, and you
refinanced to a rate of 4.74%, you would save $107 a month and $38,480 over the
life of the loan.
What must I have?
Have a good repayment record with your current lender and ensure you are not
currently in arrears. Also, know that if you’re half-way through a fixed-rate
loan you may be charged a break fee to leave. Make sure it’s worth it. Our mortgage brokers can help you understand your credit
history or weigh up the costs and benefits of breaking your fixed-rate loan.
What are my other
A new lender will likely charge upfront fees, and
there may be some costs to exit your mortgage. Also, if you have less than 20%
equity in your new loan, you’ll pay lenders mortgage insurance, which increases
Who do I see? Go
to a mortgage broker or approach a lender directly, and
if you can’t make it to see us in person, then give our Gladesville branch a
call. Mortgage brokers are
refinancing experts who know how to streamline the process.
But remember, it’s always best to approach a mortgage broker as they have
access to more rates and options when it comes to your home loan.
How long will it
take?What do I have to
Refinancing your mortgage doesn’t need to take all day. Our
mortgage brokers and loans managers can give you a quick
run-down of the process, the application, the documents
they want you to provide, and the time it typically takes.
Is it worth it?
You must answer this yourself. The total interest paid on a $300,000, 30-year
mortgage at 5.6% is around $66,000 more than the same mortgage at 4.6%. You
have to decide it this is worth the effort of refinancing.
If you still have any queries or concerns about
your home loan, don’t hesitate to give one of our friendly mortgage brokers a
call or pop by your local YBR Gladesville branch.