Australians are enjoying lower interest rates than ever before, with the recent cuts from the Reserve Bank meaning that some homeowners are shaving thousands of dollars off of their mortgage.
So, what can you do to make sure that you are making the most of a low interest rate environment? And is there anything you should be doing now to put yourself in a better financial position for the future?
Find the best deal
The official cash rate set by the Reserve Bank may have dropped, but that doesn’t necessarily mean that your lender is passing on the full savings to you.
Many lenders have decided to pass on at least a portion of the recent cuts however, with a rare few even dropping their rates to below 3 per cent.
The interest rate isn’t the only thing to consider when comparing home loans but it’s a good place to start. If you’re unhappy with what your lender is offering then now is the time to have a chat and try to negotiate a better deal.
It can take a bit of research and negotiation skills to find the best home loan, but you could make considerable savings in the long run.
You could just enjoy lower repayments each month, but since you’re probably already used to paying a higher amount in interest each month you could use your new savings as extra repayments on your home loan.
It may not seem like much, but every extra bit you can pay on your loan helps you reduce your debt quicker, which means you’ll end up paying even less interest over the life of your loan.
Seek good advice
Interest rates are just one part of the equation. There are a lot of different types of home loans out there that suit different individuals based on their specific circumstances.
It’s best to talk to a quality mortgage advisor who can find a loan that’s going to work best for your personal situation. Taking the time to find the right home loan product could help you make considerable savings.