OCR Down: War on Banks Heats Up
Thu Aug. 15th 2019
It's a fantastic time to restructure your mortgage! With the Reserve Bank reducing the official cash rate to its lowest-ever rate of 1%, banks have paid attention and cut mortgage interest rates.
It's a fantastic time to restructure your mortgage: The Reserve Bank has reduced the official cash rate to its lowest-ever rate of 1%. The banks have paid attention and cut mortgage interest rates, with two- and three-year fixed term rates below 4%. Floating rates are also down, which is good news for borrowers.
If you're coming off a fixed rate, take the time to shop around. You can potentially secure a respectable chunk of cash, you may be able to get your fees covered to switch banks and get a sub-4% rate.
Still fixed? It might be time to run the numbers on whether breaking your term makes sense.
We recently had a client with only 10 weeks to go on her loan, and she didn't think it was worth breaking the fixed term. We spoke to the bank for her and did the sums, and it was only about $350 to break the term. That money was recouped after just five weeks, so it was well worth the effort.
Contact us for a no-obligation review of your mortgage - we will contact your bank, obtain your break-fee, and calculate if the savings from a lower rate outweigh the cost of breaking your fixed rate term.
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