There are 3 Key Indicators providing a compelling argument to support the contention there has never been a better time to refinance your home loan OR take out another one. Let’s consider them.
Historic Low Int Rates
Banks reduce sensitivity rate increasing the amount you can borrow
Home and Unit prices have begun improving
It was only 7 months ago when banks were raising variable and fixed rate home loans by as much as 0.30%; out of sync with official cash rates.
Since then, we’ve seen the RBA reduce official cash rates twice to a historic low of 1% with every chance there are another two cuts by year end. With variable home loan rates nudging 3% and fixed rates below that milestone we have never been afforded such low entry level rates before.
Add to that recent changes bank and other mortgage lenders introduced in July to reduce the buffer they added to borrower loans in assessing the borrowers ability to qualify for home loans and the timing has never been better to refinance.
Timing however is everything, and whether lenders will, in the coming months, put up the shutters in response to increased scrutiny from regulators over responsible lending is one outcome but balanced against that is an improving real estate market that’s seeing FHB and investors coming back to auctions just as we prepare for the Spring peak selling season.
If you haven’t considered refinancing your current home or investment loan, its time to contact your mortgage broker and see how much you could be saving. With the majority of current variable owner occupied home loans sitting at about 4.10% it just might be a call that could save you thousands.