I understand there could be challenging periods ahead for mortgage holders, given the recent cash rate rise, and I want to reassure you that I’m here to assist.
If you’re wondering what this means for you and your wallet, I’ve answered some common questions below.
What’s the impact on homeowners?
Lenders often pass on the rate rise to variable loan holders via an increase in their variable interest rates. Even a small increase in your variable interest rate could have an impact on your repayments.
How much more could I pay?
This will vary for everyone depending on the value of your loan, what’s owing and your loan structure (fixed versus variable).
As an example, say you’re a homeowner who purchased a property for the price of $999,037 with a 20% deposit. Your monthly repayments might jump from $3,365 to $3,765 if the cash rate were to hit 1 per cent and your interest rate increased from 2.99 per cent to 3.89 per cent. That’s an increase in repayments of $400 a month.
What do I do if I can’t make my repayments?
With interest rates likely to continue going up, it’s important not to be complacent if you think you may have difficulty meeting your repayments.
The first step is to speak to me, but here are some options to consider:
- request a lower interest rate
- switching to interest-only repayments
- fixing your interest rate so you can budget for repayments
- asking for fees and charges to be waived
- consolidate debts to make repayments more manageable.
I’m available to discuss these options, so please don’t hesitate to get in touch today.
Arranging finance can be stressful, especially with some lenders now taking extra steps including going through your living expenses and credit scoring (ouch!). And sometimes banks can make you feel like ‘just a number’. That’s why we want to do things differently: because you deserve better.
As a local family-owned business, our team takes the time to listen, answer your questions and make getting your home, car or equipment loan as easy as possible.
