Lately, I’ve been doing some Q&As with our local customers here in Mortlake,
answering their questions about mortgages. I’ve noticed that there are a number
of myths and misconceptions that keep coming up, so I thought I’d address the 8
1. Once I find a good rate, I’m sorted for the life of my
loan. False! Lenders
can move their variable rates at any time, so a loan that’s competitive today may end up being really expensive
in the future. Therefore,
it is vital that you review your loan once at least a year.
2. It’s not worth refinancing a mortgage for an
improvement of half a percent. 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. That’s a huge saving!
3. A competitive rate doesn’t really matter because the
Reserve Bank controls home loan rates. The RBA adjusts the cash rate from time
to time but each lender can change their rates as they see fit. If you want to get the best
deal make sure you compare rates between lenders. At YBR Mortlake our friendly
brokers strive to get you the best rate available so make an appointment with
I can’t refinance a fixed-rate loan. Wrong. You can
refinance a fixed rate loan but you’ll be hit with a break cost, which is
compensation for the loss the bank will incur when you leave. Talk to your local YBR mortgage broker
to weigh up the break costs versus the potential savings and see what
you come up with. Still
have questions? Make an appointment with one of our mortgage brokers at YBR Mortlake
I want to use a mortgage broker but what about the
fees? Mortgage broking fees are paid by the lender, not by you. A mortgage
broker finds you the best loan at the most competitive rate, so stop by your local Mortlake branch
and speak to one of our experienced brokers today.
I’m too old to refinance my mortgage. Age
discrimination is illegal. A bank looks at your repayment ability, so they’re
looking at your income and the loan term. If you’re close to retirement, you
can look at shorter loan terms or alternative exit strategies. There is always a solution when
it comes to refinancing your home loan and our job at YBR Mortlake is to help
you find it.
7. Self-employed people pay higher interest. If you’re
self-employed and can’t produce your tax returns, you may be offered a low
documentation loan which can have higher interest rates. If your financials and
tax returns are in order, you qualify for the same rate as a regular PAYG
Banks keep secret files on my credit history. Wrong.
All lenders use a credit reporting system to check your history. Know what they
know by finding out your history at www.mycreditfile.com.au. If you’re having trouble
understanding your credit history or worried that it will impact your ability
to refinance your mortgage, make an appointment with us today. We’re sure to find a solution.
Peter Khoury’s Top Mortgage Tip: Be
My parting advice: be informed before signing anything and
always communicate with your local
mortgage broker. Most lenders would rather find you a better deal than
lose you as a customer. So
if you have any questions or would just like to chat about how I can help you
refinance your loan, then feel free to give me a call or drop by our local
branch in Mortlake today.