How to Take Advantage of Low Interest Rates
Anybody can understand why low interest rates are a good thing – paying less interest means spending less money.
But to truly make the most of low interest rates requires a bit more creativity and forecasting. Whether it’s through making additional repayments or locking down a fixed rate, low interest rates can be advantageous for numerous reasons.
It’s important to understand how to take advantage of low interest rates so that you can make the most of the times when they’re low. Economic shifts can change interest rates at the drop of a hat, so by being prepared and knowledgeable, you can ensure you get the most out of any low-rate opportunity that may arise.
Managing your repayments effectively is vital to capitalising on low interest rates. If your repayments are lower than you budgeted for, it might be best to pay the initially forecasted repayment amount anyway. The value of extra payments is exponential, and throughout the life of a home loan, these small differences can really add up.
You may be inclined to pocket the savings when interest rates decline, but it’s far more economical to make that money work for you by reinvesting it back into your mortgage. Not only do you reduce the amount owed on your mortgage, but you save yourself from feeling the burn if rates rise again.
A fixed-rate loan is a loan in which the interest rate is locked for a fixed term. By taking on a fixed-rate loan, you protect yourself from potential future rises.
But while a fixed-rate loan protects you from rising rates, it also blocks you from benefiting if rates should fall. One option might be to fix a portion of your home loan.
Of course, in order to take advantage of a home loan package with a low interest rate, you may have to leave your current lender and switch to the lender with the better rate.
Refinancing isn’t as complicated as you might think. In fact, refinancing with Mortgage House is as easy as making contact, and we have some of the lowest rates around.
At Mortgage House, we’re no strangers to the homeowner’s journey. It’s a long (but rewarding) one.
But don’t worry, we can help with that.
If you’re thinking of refinancing, you can contact us for advice about the best options for you when it comes to your mortgage. The cost of your mortgage can drastically affect your financial planning, so it pays to speak to the experts about it.