Forgetting where you left your car keys, the team that won the football championship three years ago, or even the name of New Zealand’s new Prime Minister are all forgivable lapses in memory. However, not knowing your home loan rate, a significant detail, should not make this list.
It might shock you to learn just how many borrowers are unaware of their current home loan interest rate. According to a recent Mozo report, a substantial 42% of mortgage holders do not know the interest rate they’re paying on their home loan.
Ignoring this crucial information can prove costly for homeowners.
Assessing Your Loan Rate
It’s not only that a large number of borrowers don’t know their rate, but many haven’t looked to compare rates since their initial loan approval. If that’s the case, you might be sitting on a rate that was competitive years ago but is no longer competitive today, especially with the cash rate at its highest since late 2011.
For a quick recap of your rate, check your latest loan statement or give your bank a call. This simple act can provide a wealth of information.
To put it into perspective, the average home loan interest rate for owner-occupiers sits at around 6.4%, with new home loans coming in at about 6.3%, according to data from the Reserve Bank of Australia.
The Importance of Regularly Reviewing Your Loan
Keeping on top of your home loan involves more than just knowing your interest rate. The best loan for you a few years back might not be the best for you now as your life circumstances and financial goals evolve.
It’s advisable to review your mortgage annually or after any significant life change, like expanding your family. This isn’t just about the rate; it’s about ensuring your loan still fits your current needs and lifestyle.
During a home loan review, here’s what we can check for you:
- The current interest rate you are paying.
- Whether your loan features match your current needs.
- Potential savings from refinancing.
Considering Refinancing?
If you’re questioning whether your current home loan is still the right fit, it might be time to consider refinancing. Refinancing could lower your payments, reduce your term, or provide more suitable loan features.
Call me today to discuss your refinancing options. Switching to a new loan or lender could offer savings that benefit your long-term financial health. We’re here to help you analyse if this move is right for you.
0447654321
