Don't just wait on lender to pass on rate cut
Waiting on your lender to pass on the RBA’s cut isn’t the only strategy investors can employ to make the most of the reduced rate, according to Mortgage Choice.
This second consecutive monthly cash rate cut will hopefully boost investors’ ability to repay their loans sooner, said Mortgage Choices spokesperson Belinda Williamson, and investors should put the heat on their lender to pass the cut onto them.
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However, Ms Williamson said, there are other strategies that can be employed.
"In the same way that buyers pinpoint property 'hotspots' to make the most of their investment dollars, we encourage borrowers to focus on their home loan's 'hotspots' to ensure they are getting maximum value from their loan and lender."
A simple first step includes analyzing whether or not you are making the most of any loan features and if you are not using these features, don’t pay extra for them, she said.
"With the help of a professional mortgage broker who has access to a wide range of loan products and providers, borrowers may be able to target some surprising home loan 'hotspots' that could help them save thousands of dollars in loan interest and shave months, or years, off their loan term,” she said.
Other savings hotspots include: an offset account, a redraw facility, options for extra repayments, comparing fees with other lenders and reconsidering the length of the loan term.
