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Why use a mortgage broker to refinance?

Do you remember dial-up internet access?

How about audio cassettes?

Don’t worry if you don’t; they are, of course, a thing of the past.

A 30-year mortgage with one lender is a bit the same – a thing of the past and something that is largely obsolete nowadays. Especially given the current climate.

With the cost of living going through the roof and home loan interest rates shooting up from a record low of 0.1 since last May, more and more people are refinancing their mortgages – 2,370 every working day in Australia, to be precise.

Homeowners have experienced the fastest tightening cycle in a generation, and many are ditching their current lender for a more competitive mortgage elsewhere.

Analysis from the Australian Banking Association (ABA) found 70 per cent of bank customers who refinanced their mortgage in the past six months did so with another lender.

If, like them, you feel it’s time to shop around, here’s why you should use a mortgage broker to refinance.

Expertise you can trust

At the moment there is intense competition in the home loan industry. Banks are hungry for your business and are offering all sorts of sweeteners to get you on board.

Cashback offers. Rate discounts. Package deals. The whole shebang.

So, how do you know which home loan is most suited for you?

That’s where you need a professional on your team. A mortgage broker is a trained finance specialist. We know the system and which products best suit our clients’ needs.

We are also across all the latest industry developments, so you gain access to a wealth of knowledge by working with us.

Tailored finance solutions

There are no one-size-fits-all mortgages. Everyone’s financial situation and goals are different, which is why you need tailored financial solutions.

We’ll find a loan that’s appropriate for your specific needs. If we think you could benefit from loan features like an offset account or redraw facility, we’ll explain why. But we must work in your best interests and won’t push any extras on you that you don’t actually need.

Options, options and more options

If you go directly to your current lender asking for a more competitive rate, you only get what they are able to offer i.e. their loan products and the rates they are prepared  to put on the table.

We, on the other hand, have access to the full smorgasbord – a panel of lenders with different types of products, features and benefits.

What about commissions? The commissions we receive are pretty similar across lenders. This ensures there’s no incentive for a broker to recommend one over another. Our role and obligation is to act in our client’s best interests.

Make your life easier

Trying to understand all the different home loan products out there can be stressful and overwhelming. With a mortgage broker, we can take the burden out of refinancing.

We can also liaise with your chosen lender and facilitate the whole process.

Prepare for the fixed-rate cliff

One-fifth of Australian home loans will revert from fixed to variable in 2023. Do you fall into this category?

If you do, it’s worth speaking to a mortgage broker about your refinancing options. Your current lender’s variable rate may not be the most competitive or appropriate for your circumstances, so it’s important to get a second opinion.

When your fixed rate expires, you have 3 options:

  1. Refix
  2. Reprice
  3. Refinance

Common reasons to refinance

  • Secure a more competitive interest rate
  • Make the most of possible interest-saving features like offset accounts or redraw facilities
  • Access equity for renovations, additional properties or other financial goals
  • Consolidate debt.

Like to chat?

We understand the market. We understand mortgages. And we’ll take the time to understand your financial situation and goals.

Speak to us about how your home loan compares to others and we will explain if switching lenders could be financially worthwhile. Get in touch today.

You are welcome to have a look at our website to get an understanding of our full-service offering – https://stratgroup.com.au/services/ 

 

The Financial Landscape Has Changed Forever

It is important to understand how much you’re able to borrow prior to committing to any financial transaction. With the recent evolution of the lending landscape don’t make the mistake of assuming you will automatically obtain finance.

Seek professional advice regarding loan structure and strategy at the outset.

Changes by the Banks in relation to loan term, repayment type, satisfactory security and affordability has redefined the loan approval process.

Whether you are seeking to enter the Residential or Commercial Property Market it is critical that you seek professional advice today.

Strategic Investor Group will crunch the numbers and provide you with the best options, based on your overall financial position, and individual personal circumstances.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

What will be the economic effect of the Banking Royal Commission?

We are already seeing the impact with individuals and company’s ability to access Bank loans becoming extremely difficult.

With the loan approval process requiring applicants to evidence the ability to service their borrowings at twice the actual interest rate, have the recent regulatory changes created a barrier for genuine borrowers.

Prudent lending principles are required, however, have the regulators gone too far, and will these actions have a flow-on effect for future economic growth?

Understand your individual position by speaking to a professional today.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Australia’s credit reporting system is changing. Are you prepared?

A key component lenders use when determining whether you are approved for a loan and how much you can borrow is your credit report, which sets out your previous credit applications and any defaults on your payments

Australia is currently moving to a new system of credit reporting that will help reward people who pay off their debts on time.

Following industry-wide changes, your credit report will soon show a much more comprehensive picture of your credit health and your ability to pay your debts.

Consumers who have been diligent in making their repayments on time may be able to borrow more money and at a lower interest rate than before.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Will you be affected by The Hayne Royal Commission?

Lenders have been tightening their lending controls and interest-only rates in response to regulatory pressure to lower record levels of household debt and boost prudential standards.

Ratings’ agency Standard and Poor’s is warning owner-occupiers are more likely than investors to struggle with the transition to principal and interest repayments, particularly for loans underwritten before 2015 when lending standards for interest-only were less strict.

If you have an Interest Only loan due for review it’s time to seek professional advice regarding your options.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group

Interest Rates – What will 2018 & 2019 bring?

Most economists are forecasting that the Reserve Bank of Australia (RBA) will probably only make one rate rise (+25bp) to the cash rate by late 2018 while a smaller group of analysts expect interest rates to remain on hold well into 2019. Westpac’s chief economist Bill Evans has even gone as far as saying that he expects rates to remain at current levels well into 2020.

Stability from the RBA doesn’t always translate into stability for borrowers as many have already faced rising mortgage costs during the last 12 months, especially those with investment and interest-only loans.

Now’s the time to take stock and review your individual financial position.

Carl Thompson – Commercial Lending Specialist, Strategic Investor Group