Is There an Opportunity to Secure a Fixed Interest Rate?
Clear Credit Solutions is a multi-award winning credit repair Australia service. Most consumers are unaware of what is on their credit report whether they are looking for something simple like a new phone plan or a brand-new property. Credit defaults, court judgments and clear outs can impact and stop any kind of finance application from moving ahead. These negative listings are not even discovered until a new finance application is made.
Services like ours can assist in removing these listings so clients can proceed with their finance but not everything can be removed. That is why after discovering something on a credit file the next step is to call Clear Credit Solutions. Not only do they offer the best advice and an award-winning service, but useful articles like the ones below are available throughout their extensive website.
With the Reserve Bank of Australia having raised interest rates for the first time in a decade, many homeowners have begun to consider locking-in their home loan rate. But is it too late to act? Read on this informative credit repair Australia article and find out what lies ahead of fixed-interest rates!
With over one million Australian households, many of which have never seen a rise in interest rates until now, the Reserve Bank of Australia (RBA) made an unexpected decision to hike their cash rate from 0.10% – after 11.5 years and countless cuts- up to 0.35% in May this year; leaving numerous homeowners feeling unprepared for such drastic changes to their finances suddenly occurring.
It’s probable that the first increase in May 2022 won’t be the last. In truth, three out of four major banks predict a cash rate above 2% by 2023-2024.
Homeowners frequently turn to fixed-rate home loans for a reliable way of avoiding the unsteadiness of varying interest rates. With this option, you can lock in an interest rate for up to five years so that your payments are secure and predictable throughout this period. Unlike variable interests which may fluctuate during the loan term, fixed rates provide stability knowing that your payment will not increase unexpectedly over time.
If you’ve been steadily paying off your mortgage loan, then it may be worthwhile to consider refinancing. You can switch from a variable rate home loan to an unbeatable fixed-rate option that offers stability and peace of mind. Refinancing could help you save money in the long run or put more cash back into your pocket every month.
Yet, it is important to note that fixed interest rates have steadily been rising as of late. Just last month Westpac raised its fixed rate six times in a period of 2022, NAB and ANZ hiked their own respective programs four times since the beginning of this year, while Commbank also elevated their interest rate by up to 90 basis points after increasing it fourfold during 2022.
If NAB’s prediction of multiple rate hikes to 2.60% by August 2024 comes true, the average variable owner-occupier mortgage interest rate could potentially increase from the current 2.89% to 5.39%.
Homeowners should consider prioritizing an attractive interest rate to maximize their savings in the long run. Even switching from today’s average variable interest rate to the lowest one available could potentially save you a whopping $9,298 over time if hypothetically rates continue to climb.
Homeowners should be aware that when their fixed period expires, they may revert back to the lender’s current standard variable rate. This is usually higher than what they secured during the earlier years and could become even pricier if interest rates continue to soar.
It’s not too late to take advantage of fixed rate home loans! The savings you could get from switching will depend on your financial standing and the goals for your loan. Even though fixed rates have been climbing, there is still a chance that by locking in a lower rate today you can avoid some of the effects of future interest hikes. However, how much money you’ll save depends on what kind of loaner you go with as well as what their current interests are compared to yours. It pays off to do some research before locking in any deal – it might just save more than expected while securing your finances over time.
Is your credit score or income higher than it was before, and do you have more equity in the property now? If so, refinancing may be a great option for you. Lenders usually favor applicants that possess excellent credit scores and loan-to-value ratios of 80% or lower; therefore if this is true for you today, chances are good that obtaining a refinance with an appealing rate will not be complicated.
Whether you choose a fixed or variable rate home loan, reducing the interest charged on your mortgage could help keep your payments manageable in the next years to come.
With the current interest rates on the rise, homeowners should take into account that there is more to a home loan than just looking at its rate. A variable-rate mortgage often comes with features such as an offset account or redraw facility which can help decrease your monthly payments. Therefore, it’s essential to consider all details and fees associated with any home loan before officially signing up for one.
At Clear Credit Solutions, we are the credit repair Australia experts who want to help you obtain the finance you need by removing negative listings off from your credit report. Contact us today On 1300 789 783 to clear credit! We will work with you closely to understand your financial goal and create a plan that helps you achieve it in no time. So don’t wait any longer, call us now and let us help you take control of your finances!
Source: Jasper
A poor credit score should not be a barrier to achieving your financial dreams. Clear Credit Solutions can help you by removing negative listings from your credit report, so that you can obtain the finance you need. Contact the credit repair Australia experts today on 1300 789 783 or fill out our enquiry form and we will get in touch with you! Let’s fix bad credit today!