Found yourself with a little extra time on your hands due to social distancing measures? Slightly worried about meeting your home loan repayments? While the world has changed significantly over the past few months, it’s possible to use some changes to your advantage.
Before we go any further though, we want to say we understand there’s no shortage of Aussie families doing it tough right now. And we want to reassure you that we’re here to help you any way we possibly can – including helping you apply for support packages with your lender.
So where does refinancing fit in?
Well, the many social and financial changes that have been thrust upon us recently have combined to make it a good time to consider refinancing your home loan.
Here are five reasons why you may want to consider doing so.
1. Payment relief
When was the last time you refinanced your home loan?
If your answer was ‘one year ago’ (or longer), the finance and lending landscape has changed dramatically since then and it might be time to catch up.
There have been five RBA cash rate cuts since then since June 2019.
And while we’re on the RBA, a recent study of theirs found that borrowers who refinance with another lender, or negotiate a better deal with their existing lender, do in fact achieve interest savings.
So if you or your partner have recently had your work hours cut back and you’re starting to worry about how you’ll meet your monthly mortgage repayments, refinancing could be a more suitable option than applying for a hardship variation on your loan.
2. Consolidate your debts
Refinancing can also help you consolidate your other debts – including your credit card, car loans or personal loans – by combining them into a refinanced mortgage.
Not only will this give you one simple repayment to make each month (reducing the risk of forgetting payments and being slugged with a late fee), but all your debts will be charged at your home loan interest rate – which is usually much lower than credit card rates, for example.
3. Low interest rates: time to lock one in?
Fixed rates have recently experienced a big drop.
In fact, Domain’s David Hyman has described the current batch of fixed interest rate loans as “staggeringly cheap”.
“Only a couple of months ago the cheapest headline rate started with a three. If you look back to this time last year rates were in the high threes,” Hyman explains.
“For someone with a half a million dollar mortgage, that is well in excess of $10,000 a year in savings. It’s never been a better time to refinance quite frankly.”
And with the official RBA cash rate now at a record low 0.25%, there isn’t a great deal of room for it to go much lower.
4. Time on your hands
One of the more common reasons home owners give for not refinancing is that they simply don’t have the time do so.
But, without pointing out the obvious, I think it’s fair to say that we have far fewer social commitments taking up our time at present.
So, if you’ve compiled a list of things to do to keep busy at home, consider adding refinancing to the list.
Once you get the ball rolling on it and get in touch with us you’ll be surprised how little you actually have to do – after all, that’s our job, right?
5. We’re available to help you, whenever you need us
Finally, rest assured that we’re available and here to help you any way we can.
During trying times like these we know that we need to support each other now, more than ever.
So if you’d like us to help you explore your refinancing, hardship variation, or support package options then please get in touch – we’re ready to jump into action and make it happen for you.