If you are looking to refinance your home loan in Baldivis or anywhere in the Rockingham area, you need to know a few things first. We always recommend that you call a mortgage broker at Smartline Rockingham before you make a decision. While we can’t give individual advice in a blog post, we can provide you with a few “rules” that can make your decision easier.

“Standard Rates” aren’t Etched in Stone

Many lenders advertise low rates but you may be surprised to know that you can find even lower rates from those lenders. While the trend right now is fixed-rate loans, you may be able to find a lower rate for a variable loan. This is one of many reasons that you should always go through a mortgage broker.

Don’t Fall for “Honeymoon Rates”

Many lenders use low introductory rates, called “honeymoon rates,” to attract new business. However, when the introductory period is over, the rates can convert to something much higher. The total cost of the loan is going to be more important than the introductory rate.

Other Costs

Remember that interest is not the only cost associated with any loan, especially refinancing. There will be various fees on the new loan, including an “establishment fee.” There is also a “discharge fee” for the old loan. Make sure that the cost of refinancing your loan doesn’t consume your savings.

Fixed or Variable Rates?

Right now, with historically low interest rates, a fixed rate is probably going to be the best call. However, remember that you get the least flexibility with a fixed rate. Some don’t allow extra repayments without penalty. Some charge a fee if you “break” the loan. Make sure you know which is right for you.

Package Loans

See if you can package your new home loan with offerings such as a credit card, an offset account or free ATM access. There are a lot of options that you can discuss with your mortgage broker.

To learn more, call Smartline Rockingham today: (08) 9527 1800.