Mortgage Rates are Now Rising! How you can beat the banks.

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by: andrewson23
Word Count: 440
Date: Thu, 1 Oct 2009 Time: 4:01 PM
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1. Compare, compare, compare Do not just settle for the interest rate you are currently on. If you already have a home loan, look at whether there are better deals on the market. If you are about to buy, negotiate with lenders about rates and do not only look at one lender or one type of home loan. You may not be able to get a bank to budge on the interest rate, but if they really want your business, they may waive establishment costs or something similar, but only if you twist their arm. 2. Switch to fixed rate The choice of whether to fix your home loan rate or not is a personal decision, but you can talk it over with a mortgage broker if you want professional advice. When hints of a potential rate rise began, many lenders started to up their fixed rates. However, many remain good value. It is still possible to get a five-year fixed rate at just over 5 per cent. If you want security, looking at a fixed rate could be a wise move. It will protect you from rates rising to levels above what you can afford. 3. Switch Loans or Lender Yes, refinancing your home loan can be expensive as you will have to pay exit fees, but if done correctly, refinancing your mortgage can save you money. If you can secure a lower interest rate and cover the cost of refinancing then you are on the way to financial bliss. 4. Get rid of baggage If your Melbourne home loan comes with redraw, extra repayment facilities and flexible loan structures, then chances are you are paying a higher interest rate. If you don’t need all the fancy bells and whistles, get rid of them. By switching to a basic home loan you can reduce your interest rates by around 1 per cent. Of course, if you really want these features it if better to keep them so as not to get charged to make extra repayments, but you may be able to negotiate a slightly more basic set up. You might benefit from talking to a Melbourne mortgage broker who can negotiate on your behalf. 5. Pay more than you need to Repay the loan at a higher amount and you can reduce the length of the loan. Make fortnightly payments instead of monthly as reduce the principal and interest quicker. You can also channel any extra funds into your mortgage. So if you receive a bonus, a tax rebate, or some extra savings, put this into your mortgage and reduce the amount of interest you pay.

About the Author

Mark Broker has changed the way thousands of people think about their Melbourne Mortgage.He can put you on the right track, guaranteed!

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