Are you flushing money down the drain by putting off refinancing?

Are you flushing money down the drain by putting off refinancing?

Every year thousands of Aussie families flush their hard earned dollars down the gurgler because they put off the simple act of refinancing their mortgage. If you’re overdue, rest assured that it’s much easier than you may think!

While there are no hard rules about refinancing, it makes financial sense to review the loan when your individual circumstances change.

For example, you may be growing your family, moving to a new location, or getting married.

There are also plenty of reasons that exist outside personal circumstances, including the major financial benefits it can offer, and we’ll run through some of these below.

Refinance to get a better rate

Refinancing does not always have to mean changing banks.

There are hundreds of circumstances in which borrowers refinance their loans to get a better rate from their bank.

The mortgage market is very competitive, and a deal signed two years ago may not be in your best interest today.

However, if your bank is not in a position to offer you a better rate, there are many lenders in the market who can get you a better deal.

Lock in a great rate

You may have seen the news recently that the RBA kept the official cash rate on hold at 1.5%, but for how long.

However it won’t stay that low forever!

In fact, half of Australia’s leading economists in Australia’s longest running survey – the BusinessDay Scope economic panel – believe the RBA will lift its cash rate by the end of the financial year.

With so many experts predicting interest rates to rise in the next 12 months, and some banks already increasing their interest rates, now could be a good time to lock in an interest rate on your home loan.

Consolidate debt

Refinancing helps to reduce the interest payable on the different loans you have, which can include credit card, car loans or personal loans.

It basically involves combining all the loans into a new mortgage, giving you one simple repayment to make each month instead of a bunch of them – which can lead to late fees if you forget one.

The best news? All your debts are charged at the home loan interest rate – which is usually much lower than a credit card rate!

Increase your investment

If you are looking at your investment options but are financially constrained, it’s time to consider refinancing your mortgage.

One reason to do so is to buy another property.

Refinancing in this circumstance makes a lot of sense because you could have enough equity in your property, which may enable you to make another house purchase.

Get in touch

If you’re feeling like it’s probably time you should refinance your home loan, but are simply too busy to do so, then we’ve got great news for you: our job is to make it super quick and easy!

In fact, we can help make the whole process so stress free you’ll be kicking yourself for not doing it earlier.

So if you can identify with any of the above reasons to refinance you home loan, feel free to get in touch with us today!

 

 

How to perform a credit health check

How to perform a credit health check

Significant changes have been made to Australia’s credit reporting rules after a new Comprehensive Credit Reporting regime (CCR) came into effect in the new financial year. This means now is as good a time as ever to perform a credit check.

The new legislation forces full compliance from Australia’s Big 4 banks, who have previously refused to take part.

In years gone by most lenders have only shared negative information. However, the new laws require that positive information such as a history of regular, on-time payments and the early repayment of loans is also included.

It is expected that this will result in increased scores for many borrowers.

Why should you do your own credit check?

Lenders will have access to your credit score, and you should too.

You don’t want to have a loan application declined because of inaccuracies, errors, or identity theft – all of which can find their way onto your report.

It’s therefore prudent to review your credit score once a year to make sure there are no surprises.

How can you conduct a credit check in Australia?

You can get a free credit report once a year from one of three national credit reporting bodies (CRB’s) which are listed on this government website.

You can also get a free report if you have had a loan application refused within the past 90 days, or if the request relates to a correction request.

If not, there are a number of fee-for-service options, depending on where you live.

Tasmanians are advised to check with the Tasmanian Collection Service and Equifax, and those living in other states, to check with Equifax, Dun & Bradstreet and Experian.

Keep in mind that it’s possible you could have a credit report with more than one agency.

Next steps

If you find errors in your report, you can get them corrected before they can adversely affect your credit score.

For those who find they have a ‘poor’ credit rating, you can take steps to improve it by clocking up a period of future consistency and reliability.

For those with a good credit rating, you will be better positioned to demonstrate your credit worthiness and seek more competitive interest rates.

If you’d like any help conducting a credit check or addressing what you find out, please don’t hesitate to sing out.

We can walk you through the process to help you secure the credit you need to purchase your next property.