Interest Rates Are Plummeting

Are You Being Ripped Off?

Does Your Interest Rate Have a ‘4’ in Front of it?

www-masytermortgagebrokersydney-com-au-scissors-cutting-percentage-rate-signWith the latest home loan interest rate cuts experts are now saying if your owner occupied home loan interest rate doesn’t have a ‘3’ in front of it you are being ripped off.

However, this is not necessarily the case with investment property loans as most of those rates still have a ‘4’ in front of them. Having said that though, borrowers should even start checking out what deals are available for those loans too.

Both fixed and variable interest rates have plummeted to under the four per cent mark with the recent cash rate cut that’s now at the all time record low of 1.5%.

How Good are Today’s Rates?

At the time of writing the lowest variable rate available in the market is just 3.39% and fixed rate deals are also at tempting levels. For example 2 years at 3.58%  3 years at 3.58% and 5 years at 3.58%

It should be noted that the rates quoted above can be dependent on the type of loan you’re applying for. Different lenders have different policies when it comes to loan to value ratios, the type of loan you want (owner occupied or investment loan) and the amount you want to borrow.

Are You Winning the Mortgage Game?

www-mastermortgagebrokersydney-com-au-chasing-interest-rate-ball-down-stairsFor those homeowners who would like to get ahead of the mortgage game these amazingly low rates offer them a great opportunity. Who knows when mortgage interest rates will start to rise again, hopefully not for a long time? All the same, while they remain at these historic lows it’s an excellent opportunity to pay extra into the mortgage and start paying it off faster.

Will there be more rate cuts, it’s highly possible? The rate of inflation is lingering about the 1.5% mark, which is well below the Reserve Bank of Australia’s benchmark levels of 2-3%

Where are Interest Rates Headed?

The Australian economy continues to dawdle along as business investment is low and consumer demand isn’t very high. The exchange rates of the Australian dollar keep creeping up towards the high seventy cents mark to the US dollar. The national unemployment rate continues to hover around the 5.6% mark, but doesn’t include all those people, and there are many, who have given up looking for work.

Some experts are predicting that there is still another rate cut on the cards. Another rate cut would take Australia’s cash rate down to the record low of 1.25%. Even a couple of months ago, no one would have predicted that.

However, will the Banks Pass on the Rate Cuts?

The big question on most everyone’s mind is, will the banks pass on these rate cuts in full. The answer is no! You see, the banks have found a new game to play with interest rate cuts. They will pass on some of the 0.25% rate cut given by the Reserve bank of Australia and they keep the rest of the cut up their sleeves.

http://mastermortgagebrokersydney.com.au/wp-content/uploads/2016/09/www.mastermortgagebrokersydney.com_.au-what-is-your-interest-rateWhat does that mean? They hold back some of the rate cut so they can use it for marketing purposes. So, this is where the borrower needs to become street savvy when it comes to finding the best interest rates for their particular loan.

How does this work? These days the banks are now holding back a significant portion of any rate cut passed by the Reserve Bank of Australia so they can use it for special promotions at a later date. They may come out with a special variable rate for owner occupied or investment loans. As can be seen in the current market place they are using these extra basis points they have up their sleeves to offer tempting fixed rate loans, most of which are notably below the 4% mark.

However is it time to fix?

Maybe not, because with any more rate cuts you are going to see even more record breaking deals flooding onto the market place in the forthcoming months. Although, for those that are fixed rate minded, you might want to consider doing a split loan. That is, part variable and part fixed rate.

For anyone who wants an owner occupied home loan to purchase or refinance that is in excess of $250,000 and has a loan to value ratio of 80% or less the interest rate you should be looking at should be notably under 4%. Anything that’s got a ‘4’ in front of it means you’re paying way too much (being ripped off in other words).

About About Dave Fleming

Dave is enthusiastic and fascinated by the digital and social media worlds. He is passionate and enjoys entrepreneurial pursuits, wealth creation financial strategies, health, fitness as well as cooking. Dave is the webmaster at www.mastermortgagebrokersydney.com.au, which is an information website pertaining to loans. He has a deep commitment towards writing about and helping people understand the basics of how the financial world works.

Should I be looking at refinancing? Read This First

Broker Blogger On Honeymoon Rates


Let Me Introduce Myself

Ways to pay off your mortgage fasterAs this is my first blog I should explain myself in the way of what this is going to be all about. As I’m very passionate about saving our customers money on their mortgages I’ll be talking mainly about ways to pay off your mortgage faster.

Some of the tips that I’ll be sharing will be mainstream and already common knowledge to many. Nevertheless, they’ll serve as a reminder and potential motivation to those who know, but haven’t gotten into gear yet and done something about it.

Other tips will be not so well known. These will be rapid mortgage reduction techniques that will be out there on the edge and they won’t be for everyone. It will depend on one’s appetite for risk.

On the other hand there are other things that I’m passionate about in life. One of them is living a healthy lifestyle. Yes, that’s right I’m a health nut!!!

Don’t worry though I’m not going to berate anyone on what they should be doing with their life, or how they should be living it. From time to time I’ll provide a health tip, which will help in making your life longer and more vital.

However, in the main I would like to keep this blog light hearted, entertaining and as well as useful. So peppered throughout my blogs will be other humorous and interesting information.

You might also like to check out our home page

Here’s a mortgage joke:
A frog leaps into a banking institution and requests of the teller on duty, “Who should I speak with about applying for a loan?”
The teller leads the frog to the office belonging to the lending manager, Shirley Black.

“I would like to apply for a loan of $20.00 to get a brand new lily pad,” the frog informs her.

”Have you got any security?” inquires Ms. Black.

The amphibian then shows her a little statuette of a pinkish elephant which has the inscription “Souvenir from Thailand” etched on to the base.

Uncertain about whether the thing will be worth the sum of the loan advance, she calls for the bank manager.

The bank manager examines the souvenir, then nods his head, and states, “It’s a knick-knack, Shirley Black – so you can give the frog a loan.

Beware the Honeymoon Trap
Okay, here’s the first useful tip about saving money and paying your mortgage off faster.Hungry house grabbing more cash

Watch out for loan providers offering gifts. Promotional or honeymoon interest rates have for ages been an essential marketing strategy for banking institutions. You’ll initially be furnished a low-cost rate on your mortgage to lure you through the doorway. However, once the honeymoon interval has ended, the mortgage lender will probably switch you to an increased variable interest rate.

There are two main issues with this scenario. First of all, the variable interest rate is usually greater than many of the lower basic loan rates offered which means you will finish up having to pay more. Secondly, it is advisable to clearly realise that a honeymoon deal is applicable simply for your first year or so of the mortgage only and is a minimal thing to be considered when compared to the real variable interest rate designed to calculate your actual repayment amounts across the subsequent twenty or so years.

You may even get hit with extreme exit fees and penalties if you all of a sudden made a decision to re-finance within the first 1 or 2 years to a more cost-effective mortgage. For that reason be sure you fully grasp what you’re really jumping into before ‘sailing off’ on that “honeymoon” with your mortgage lender.

Having said that though in more recent times some lenders have started to offer honeymoon loans of up to four years, which may be worth considering. That’s if the fees to exit the loan after the honeymoon period and go to another lender, don’t eat up all the savings you achieved during the honeymoon period.

Okay, This One’s a Little Better:
Bouquet of flowers with "Rest In Peace" cardAfter a client purchased a new house the mortgage broker decided to send out flowers in appreciation of the special occasion.
They eventually arrived at the client’s home and the home owner looked at the card; and it read “Rest in Peace”.

The homeowner wasn’t happy and frustration turned to anger and he decided to call the florist shop to give them a piece of his mind.

Right after he informed the florist shop owner of the totally obvious blunder and in no uncertain terms described just how angry it had made him, the owner said, “Sir, I am truly so very sorry for our slip-up, but instead of getting offended you need to picture this:

Someplace there’s a funeral service taking place this day, and they’ve got a floral arrangement which includes a note declaring, “Congratulations on your new home”.

Health Tip:
Did you know when you stop exercising many of the benefits begin to diminish within 2 weeks? The benefits of exercise typically disappear completely within 2 to 8 months of stopping exercise.

That’s it for today and thanks for your time. I’ll be back on a regular basis with more helpful money saving hints, humorous information to lighten up your day as well as more health tips to energise your day and lengthen your life.

About About Dave Fleming

Dave is enthusiastic and fascinated by the digital and social media worlds. He is passionate and enjoys entrepreneurial pursuits, wealth creation financial strategies, health, fitness as well as cooking. Dave is the webmaster at www.mastermortgagebrokersydney.com.au, which is an information website pertaining to loans. He has a deep commitment towards writing about and helping people understand the basics of how the financial world works.