Four signs it might be time to refinance your Hamilton home
The pandemic has drastically changed the way we live and work.
For some Hamilton home owners, there may have been big changes to their financial situation.
You may have changed jobs or been promoted? Perhaps you’ve saved up some extra funds during lockdown, or you may be struggling to make ends meet?
Maybe your goals have shifted – you’re no longer saving to travel to Europe; instead, you have decided to renovate your home, to create the ideal retreat during lockdown.
If there’s been a change to your financial situation, that’s a good enough reason to review your home loan.
But there are other good reasons to give it a going-over; we’ve listed four below;
You’ve been with the same lender forever
Interest rates are at historic lows and competition between lenders is fierce. There are plenty of good deals out there, so it’s important to shop around.
If you’ve been with the same lender for years, chances are you’re probably missing out on a better deal elsewhere.
If your interest rate isn’t close to 2%, we should talk. Get in touch today.
You have no idea what a redraw facility or offset account is
Most home loans nowadays come with money-saving features like offset accounts and redraw facilities.
These tools allow you to save in interest and potentially pay off your loan sooner.
How they work
With this set-up, a transaction account is linked to your mortgage. Any money deposited is offset against your loan balance, reducing your interest payable.
Example: you owe the bank $400,000 and you have $50,000 in the offset account. Interest will only be calculated on $350,000.
With this loan feature, you can make extra repayments on your mortgage and potentially save on interest. On top of that, you can still access the funds in future should you need them.
Your personal circumstances have changed
What’s changed since you took out your mortgage? Are you earning more money? Have your living expenses changed? Do you have different financial goals?
All of these elements need to be taken into consideration when choosing the right home loan for your needs. Contact us to go through why this is the case.
You’re drowning in debt payments
If you’re struggling to cover multiple debt repayments, debt consolidation could be the answer.
This strategy involves refinancing your mortgage and using some of your equity to pay off your debt.
The benefits are:
- Home loan interest rates are lower than other types of credit
- You’ll only have one repayment to meet
- You can spread the repayments out, so that they’re more affordable
- You may be able to make additional repayments and knock off your debt sooner.
While debt consolidation is not right for everyone (in some instances, you may end up paying more in interest over the course of the loan), it’s at least worth investigating.
Like to know more?
We’d be happy to review your home loan and check whether you’re getting the most competitive loan for your current financial situation and goals.
Get in touch today!