Why should you refinance?
Reviewing your home loan every year or two is a very good habit to get into.
As the market and your circumstances change, the home loan that was just right for you then, may no longer be one that suits you now. You may be looking to save a bit of money, consolidating your debt or looking to unlock some equity you’ve built up in your home. Whatever the reasons, it is a good idea to see what is out there on a regular basis. But you should also bear in mind the long-term costs of increasing your borrowings.
A loan with a lower interest rate or less fees can be the simplest way to reduce your repayments. It means you can unlock a little more spending money, or better still, pay off more of your principal to pay the loan back sooner.
But it is not all about interest rates. Sometimes the loans with the lowest rates also sacrifice features that are not only handy, but also save you money in the long run. For example:
Offset account. This is a separate account that lets you use the balance to offset the principal on which your interest is calculated. Simply having your pay packet deposited into this account can take time off your loan.
Flexible payments. Paying some more money into the loan if you have it is a great way to shorten your loan and save more in the long run.
Redraw. This lets you easily access any extra funds you have deposited into your loan.
Flexible rates. Depending on what you think rates are going to do (go up, down, or stay the same), you can choose the type of loan that could save you money when they go down or protect you if they rise.
Of course, each lender will have its own terms and conditions, and it is important to consider the effects of these rules when choosing a loan.
We HSD Finance is always here to help.
About HSD Finance:
HSD Finance is a full-service mortgage brokering firm based in Sydney and serving Australia wide, we are here to assist with customers in all financial needs.
For details get in touch with our support team on 1300 311 123 or email us