The Property Market – It’s An Investor’s World
You will have to move fairly quickly if you want to secure a low fixed interest rate on your current mortgage. That being said, even though most lenders are slowly increasing their 2 to 5 year fixed interest rates, these are still currently occuring in small increments.
You could still be better off going for a fixed interest rate because they are still significantly cheaper than the average variable rate loan. And even with concerns of an increase in interest rates, it is still an investment buyer’s world in the Australian property market thanks to negative gearing.
The federal government provides a back plan through negative gearing, and that is why property investors are still growing strong.
View our six tailored step process to get the home loan that is right for you.
Refinance Step One: Lower Interest Rate
It is highly likely that the RBA cash rate will remain at a record low of 0.10% until 2023. It remains a golden time for Aussies looking at refinancing their current mortgage to purchase another property.
As you may be aware, the lower the cash rate, the lower the interest rate for borrowers. But current lenders are usually reluctant to pass on lower rates to their existing customers. Therefore, you will likely have to switch to a different lender for a better interest rate deal.
Finding a lender with a lower interest rate is not hard, but finding a lender with a lower interest rate and the right terms to ensure you are going to save a significant amount of money requires work, knowledge, and experience. That is where we come in.
Contact us so we can discuss your options.
Refinance Step 2: What’s Your Home Worth?
Now that you have lowered the interest rate on your current mortgage and are paying a significant amount less in monthly repayments, what next?
The next step is for lenders to arrange for your property to be valued. If you are looking to purchase another property, having your home valued to understand its worth in the current market can significantly increase the amount you borrow on your next property purchase.
The lender will calculate your property’s LVR (Loan to Value Ratio), and this will determine the amount you can borrow, represented as a percentage of the value of the property you’re buying. Naturally, the bigger your deposit, the lower the LVR will be.
The value of your property affects the amount of equity you have. Contact us so we can assist you in finding an accurate indication of your current property’s value.
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