Refinancing your investment or home loan
As time marches on, situations change. Perhaps you’ve changed jobs? Or there’s a new addition to the family? Maybe you would just like a better rate or better structure? Maybe it’s the advent of school fees, or that leaking shower or tired kitchen has just reached the end of its life.
Whatever the shift in circumstances, it is time to revisit your home finances especially with the changes in rates for Principal and Interest and Interest Only repayments.
For many, the idea of refinancing a mortgage can be daunting. Fees, fixed versus variable interest rates and monthly charges all need to be considered. The right refinanced loan could help you pay off your mortgage faster and for less, increase your property portfolio, clear unhealthy debt or help you upgrade and add value to your home.
But where to start? An Avenue Financial broker can help you weigh it all up.
Can I get a mortgage where I pay less than I’m paying now?
With lenders adjusting their rates outside of the reserve bank now is a great time to check that you have the right loan for your needs, an Avenue Financial broker can help make this process smooth. Some of the answers we will need to know include; what interest rate you’re currently on, what type of home loan you have (e.g. fixed, variable, interest only, line of credit) and what features you would like in your loan.
Can I consolidate credit card or other debts into a home loan? This is one of the reasons many people refinance. The advantage is that you pay a much lower interest rate on a mortgage than for most other forms of debt – e.g. credit cards, overdraft facilities, personal loans etc.
Providing you have sufficient equity in your property, you may be able to consolidate all your debt on a home loan. If you take this option though, it is important to make sure you maintain your repayments at their current level or you could end up paying more over a longer period of time.
How much money can I borrow? We’re all unique when it comes to our finance and borrowing needs. Get an estimate on how much you could by contacting Avenue Financial and one of our dedicated brokers can help with calculations based on your personal circumstances.
How do I choose the loan that’s right for me? Our website has guides to loan types and features that will help you learn about the main options available. There are hundreds of different home loans available, so contact us at Avenue Financial and one of our brokers can work with you to recommend the right loan(s) for you.
What fees/costs are involved in switching mortgages? In most circumstances any fees/costs are minimal with the exception of breaking a fixed rate loan early. Note that an Avenue Financial broker will not recommend to move from your existing lender if you are not benefiting from the restructure.
Below is an example of how a small reduction in your interest rate or restructuring your financial arrangement could make a big difference to the long-term cost.
Compare the two
Loan 1 – A loan direct with one of the big four banks
A standard variable rate of 5.20% with an upfront cost of $395 and ongoing monthly fees at $33.
Loan 2 – Avenue Financial sourced loan
A standard variable rate of 3.99% with an upfront cost of $250 and ongoing monthly fees at $10.