Well, this is where I come in of course. Let's look at a scenario (and this can be either when you first buy your home or when it is due to come off its fixed period).Loan $300,000
Special 3 yrs 5.95% - thats an amazing rate when most in the market are 6.65% at best 6.25% for a great normal discounted rate. So a difference in 0.3% from 5.95% to 6.25%.
The difference in cost to you is $17 per week or $900 per year for the next 3 yrs - $2,700 saved. Quite a significent saving. But also take into account the cost of moving your mortgage:
- Application fees (often zero but in some cases are charged)
- Legals $1500 - $2000 typically
- Break fees if you are still on a fixed rate
- Hassle and often the new bank will want you to move all of your banking to them.
- Will the new lender give cash as well to offset these costs?
- Are there ongoing costs that you need to find out about (refixing loans etc)?
- Does this lender have the online banking/branches etc that suits the way you bank?
- the offer available if you have a smaller than 20% deposit or equity?
Another example - a cash offer, say $2000 or even $3000 to change banks - what does this really mean to your cashflow and will you be ahead after taking all of the above things into consideration?
Or - how about the employee package you can get. Is this better than the specials? In some circumstances it will in others no way.
The only way to really find out is to crunch the numbers and see which way you are better off. If you want help with that then I'll work with you to figure it out, often the best decision is to stay put and get me to negotiate for you.
And at the end of the day, the way you structure your loan is the most important thing. Its specific to your own circumstances and the specials offered may not even work for your own situation.
So, who do you know that wants an advisor who really works in their best interests and pushes for the best result?
Pass this to your friends and colleagues so they can see what may be possible.
Or, if you haven't taken the plunge yet then Contact me if you'd like to discuss your own situation. 027 503 1080 or 03 319 5482.