As interest rates rise, homeowners may be tempted to switch lenders and refinance their mortgage at a lower rate.
MELBOURNE, Australia, Aug. 01, 2022 (GLOBE NEWSWIRE) — According to Liberty, a non-bank lender, borrowers should beware of long-term costs when looking to refinance their home loan.
Australians are refinancing at record highs. PEXA reported a 16% increase in refinancing volume compared to the same period last year. The latest lending indicators from the Australian Bureau of Statistics revealed that $16.7 billion in mortgages were refinanced in April this year.
According to Liberty communications manager Heidi Armstrong, a lower rate may be attractive, but the change could end up costing longer-term borrowers more.
While repayments and interest rates may be lower, Armstrong advises paying close attention to the overall term of the loan when refinancing.
“Remember that you don’t end up making more repayments and paying more interest in the long run.”
It is important to remember that interest rates are only one of many variables to think about. Homeowners should factor in all costs associated with refinancing, such as application fees with the new lender and discharge fees with the current lender.
“While adjustable rate loans often have low or no release fees, if you’ve fixed your rate, you could incur costly breakage fees. To get the full picture, be sure to do the math.” Ms Armstrong recommends online comparison calculator tools like ASIC’s MoneySmart Mortgage Switch Calculator to check how much money can be saved.
As a leader in the Australian mortgage industry, freethinking lender Liberty works closely with borrowers looking to refinance.
“At Liberty, we take a personalized approach to ensure that each borrower receives a solution tailored to their unique needs.”
Ms. Armstrong encourages borrowers looking to refinance to speak with an expert who can help them navigate the process and refinance with confidence.
“Every dollar counts, so it may be worth getting an expert opinion before deciding to jump ship.”
A Freedom Advisor can guide homeowners through their options, to find a tailored solution that best suits their situation. They can help determine if refinancing is appropriate and make the process smoother.
Non-banking also encourages borrowers with irregular incomes or who are self-employed to consider more freedom of mind home loans when looking for refinancing.
Approved candidates only. Lending criteria apply. Taxes and fees are payable. Liberty Financial Pty Ltd ACN 077 248 983 and Secure Funding Pty Ltd ABN 25 081 982 872 Australian Credit License 388133, trading together as Liberty Financial.
Group Leader – Consumer Communications
Such. : +61 3 8635 8888
Email: [email protected]
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