There are many reasons why someone may refinance a loan. The most obvious reason is “to get a better rate” so you pay less each month. But there are other factors at play; you may want to switch from a variable rate to a fixed rate loan so you have some certainty over your repayments regardless of interest rate changes. You may want a loan with some features like an offset account. Or you might have other debts like credit cards and personal loans that may be able to be refinanced with your home loan to save on your total monthly payments.
While the reasons to refinance are varied the one thing you should do is regularly check that your current loan is still the right loan for you.
CHECK IN WITH YOUR BROKER AT LEAST EVERY TWO YEARS.
A 10 MINUTE CALL COULD SAVE YOU PLENTY IN THE LONG RUN
Think of your mortgage and finance broker like they are your personal banker. Every time something changes in your life that may have financial consequences, you should contact your broker and ask them how these changing circumstances will alter the way your bank views you as a customer.
These could include such things as:
You are about to change employment
You are about to open a credit card (or up your limit)
You need a car loan or money for a large purchase
You want to buy another property or start to invest some money
Your debts are starting to mount up and you are finding it difficult to get on top of your payments
If you use your broker like a personal banker they can advise you how your potential decisions can affect your borrowing capacity in the future and they may be able to provide you with multiple options to help you get what you want.
If your circumstances are about to change or you haven’t had your loan reviewed in the last two years, it’s time to discuss your options.
It could be the best financial call you make this year.